Behavioral Factors in Private Wealth Management

As a private wealth manager, you are tasked with developing an investment strategy for a high-net-worth individual (HNWI) who has recently retired and seeks to preserve their wealth while ensuring a comfortable lifestyle in retirement. During your initial meetings, the client expresses significant concerns about market volatility, which they attribute to recent economic downturns, and they desire an investment portfolio that minimizes risk.

Given the behavioral biases that high-net-worth individuals can exhibit, such as loss aversion and mental accounting, explain how these factors may influence the client's investment decisions. Additionally, discuss strategies you could employ to help guide this client towards a more rational investment process that aligns with their long-term goals.