A man is on his honeymoon in Las Vegas. His partner has gone to bed, but he can$$t sleep. He finds $$100$ in his wallet and decides to go down to the casino and gamble. He places that $$100$ on the roulette table to be exchanged for chips. The croupier misunderstands and thinks he is betting $$100$ on $22.$ Oddly enough, the ball lands on $22.$ At $35-$to$-1$ odds, the man is now up to $$3,500.$ Getting excited about his winnings, he forgets to remove his chips. The croupier thinks he$$s betting on $22$ again. Unbelievably, the ball lands on $22$ again! Now the man is up to $$122,500.$ He decides he$$s on a hot streak. He bets on $22$ again. However, the ball lands on $18.$ He loses all his winnings. He goes back upstairs to his room. His partner wakes up and asks where he$$s been. He says he was gambling. His partner asks how he did. He replies, $$I lost $$100.$

In reality, he lost $$122,500.$ He didn$$t think of it as his money at the time because it was money he won, not money he earned. He could also be embarrassed by his loss, so not thinking of it as his money helps to protect him. Either way, people make irrational decisions with money all the time. It is the job of the financial advisor to steer clients in the best direction.

When it comes to investment decisions, a financial advisor must evaluate the client$$s investment goals. They also must evaluate the client$$s willingness to handle the ebbs and flows that come with the stock market.

For your initial post, imagine you are a financial advisor working with a client and the stock market is crashing. Your client is panicking. Answer the following questions:

What would you advise your client to do in the short term? Why?

What would you advise them to do in the long term? Why?

How will you reassure your client?