Just when it seemed impossible for the financial crisis to get worse, along comes year-end and the mutual fund industry’s capital gains announcement season. Ugh.

While many funds have managed to avoid gains, there remain many that will be forced—unless the federal government moves to provide relief—to explain a taxable event in a deeply down market. So how are you preparing to respond to your clients (both financial advisors and investors)?

When it comes to making these announcements, our position is to get it done “sooner rather than later.” By getting word out now, you’ll give advisors sufficient time to harvest losses for their clients. While you certainly don’t want to encourage redemptions, maintaining relationships is key. Further, for many, it makes a lot of sense.

Guard against following a business-as-usual routine for this year’s capital gains communications. Accelerate the timing of the announcement and review every word of your statement from the vantage point of financial advisors and shareholders who have survived the worst financial crisis in decades—and yet are still invested with your firm. Your communications need a deft touch and a lot of empathy.

For more, download SwanDog’s five recommendations for how financial services marketing can respond to the financial crisis.