Taming the bears: PFPs help clients face fears as market growls.

• Author: McCrary, Deanna
• Position: Personal financial planners - Cover Story

Romani is not Glenda Moehlenpah's native language. You won't find her dressed in ornamental scarves. And her earrings don't dangle. But Moehlenpah, a CPA and CFP, does own a crystal ball.

And it's during financial times like these, as bears run wild on Wall Street, that Moehlenpah--and her clients--wish she knew how to use that crystal ball that's perched predominately on her desk.

"Clients get a kick out of it," muses the owner of San Diego-based Financial Bridges. "They often ask, 'Do you know how to use that thing?"'

As the stock market absorbs hit after hit, financial planners are being challenged to keep their clients cool in a heated environment. A drastic change from just a few years ago.

In the late 1990s many investors rode the crest alone. They reached new heights and made money in a market where few could wipe out. No longer. Between overvalued tech stocks, the Sept. 11 terrorist attacks, widespread layoffs, accounting scandals and a potential war with Iraq, many investors doubt their ability to manage their own accounts.

Such turbulent times, however, bring challenges--and opportunity--to today's personal financial planners.

CLIENT REACTIONS TO THE BEAR MARKET

During the heady late-1990s, many investors believed they possessed a high-risk tolerance. But now that their tolerance is being put to the mettle, many have found that they really aren't big risk takers. That realization, coupled with media messages, the "herd mentality" and the prolonged length of the market decline, has caused much hand wringing among investors.

"As we start the investment process with our clients we make it clear that inherent in stock market investing there are down periods from time to time and one has to be willing to tolerate those when they occur," says Karen Goodfriend, CPA/PFS, CFP, of Menlo Park-based GoldsteinEnright Financial Advisers Inc.

"However, it's one thing to talk about it and it's another to actually go through it for a prolonged period. I've noticed that now that we have had consecutive [down] years, it's getting to many of them."

Many personal financial planners said more and more of their clients are growing more concerned about their investments, the economy and what the future may hold.

Chris Baker, CPA/PFS, CFP with Financial Planning Services in Newport Beach agrees. "My clients were mentally prepared for a downturn, but the severity and longevity of the bear market caught all of us by surprise," she says. "Most of the concern...