Financial Advisors take on the New Year What’s the focus for 2021?

As we let the final gasps of air out of 2020, the last thing we need is a long laundry list reminding us of all the troubles we faced and the fact that far too many Americans found themselves on a treasure hunt for toilet paper last spring.


Yet, like it or not, here we are facing another year full of uncertainty.

With the great vaccine debate raging and health officials warning us that the worst of COVID-19 is yet to come, it begs the question: Where do financial advisors go from here?

Remain Focused on the Clients

plan4x4That is not intended to be a Captain Obvious slap to the head.

It is more like a friendly reminder that client handholding should increase as the industry heads in to 2021’s uncharted territory.

Tom Baker, cofounder of Blue Oak Capital, LLC, based in Menlo Park, California, agrees that keeping the focus on the clients is a winning strategy for the new year.

“To me the pandemic has really been an affirmation that clients really need my attention,” he said. “They want to know: Are they going to be okay? Will they be able to realize their objectives and goals,” based on current economic conditions?

For now, Baker said he intends to continue doing what he has always done when creating plans for his clients.

“I come into meetings with clients with a blank yellow pad and two ears,” he said. “That is where I start. From there, I build a plan that works for the client and sticks within their objectives and goals.”

Take Another Look at Climate Change

Huh, you ask. What is that doing in an article about how to move on a pandemic year?

climatechange500Climate change has not eased up just because the globe’s citizenry is being attacked by a virus. Paying closer attention to “environmentally friendly” investment options in 2021 could pay off for decades to come.

Early December 2020 reports by two leading environmental organizations – the World Meteorological Organization and the United Nations Environment Program – document that 2020 has not been a good year for appeasing Mother Nature. In fact, all the attention on COVID-19 is wreaking havoc on attempts to keep Mother Earth from heating up further.

The WMO produced data that shows 2020 is on track to being the third “hottest” year in Earth’s history despite the cooling presence of the La Nina phenomenon that lowers water temperatures in the central equatorial Pacific Ocean, as reported by Canadian news agencies such as the CTV News and the Toronto Star. Data collected by the UNEP shows that fossil fuel production will increase by two percent in 2020 rather than decrease by the six percent that United Nations researchers say is necessary to meet global climate control goals by 2030 as agreed upon in the Paris Accords.

Jeff Gitterman 1“Physical climate risk is the major black swan coming behind the pandemic, and the effects of it are severely missing as a fundamental conversation in our industry,” said Jeffrey L. Gitterman, cofounding partner of Gitterman Wealth Management, located in Edison, New Jersey. He thinks physical climate risks such as floods, droughts, extreme heat, extreme weather and water and food scarcity will have a “disproportionally” large (and negative) impact on the United States economy. He thinks it might even be more than the combination of the 2008 Housing Bubble and the COVID-19 pandemic. “We are already seeing rating agencies and insurance companies begin to assess how to price climate risk. As this continues, it will become harder and harder for the average investor to get out of harm’s way. The data is already available for investors to de-risk their portfolios. And the time to act is now.”

Continue to Embrace Remote Working

working remotelyIt would be so comforting if after New Year’s day we could all again gather around the water cooler and tell those age-old fibs about how great our holidays were.

Not gonna happen.

In the second week of December 2020 as news of vaccine distribution getting a green light hit the news, the San Diego Union-Tribune polled area business leaders and university experts to determine if they thought workers would be going back to the regular office anytime soon.

The overwhelming response was no.

James Hamilton from the University of California-San Diego said, “it’s not yet time to send the ‘all clear’ signal,” based on his belief that the vaccine won’t reverse the pandemic until a significant portion of the population receives it. That, Hamilton, said, “is still far ahead of us.”

Chris Van Gorder, president and CEO of Scripps Health points out that researchers and vaccine developers do not know at this point how long immunity gained from the first round of vaccinations will last.

“It will take at least through the second or third quarter of next year to get enough vaccine and manage the logistics of vaccinating enough people to gain herd immunity,” he said. “But, since many companies have adapted well to working remotely, there doesn’t appear to be an imperative for returning to the workplace quickly, if at all.”

That sentiment is echoed by Ricardo L. Cortez, CO and CEO of Broadmark Asset Management, LLC, based in San Francisco, California.

While he admits is would be “most desirable” that investment, research, sales and operation personnel work together in the same location, he also knows that utopia may just be a thing of the past.

“Our experience has been that through Zoom and other technological methods of communication, there has been no diminishment of the quality of work or communication as the result of working remotely,” he said.


Follow Us

Subscribe to Our Newsletter

What's Next, Updates & Editorial Picks In Your Inbox

© 2017-2021 Advisors Magazine. All Rights Reserved.Design & Development by The Web Empire