Perhaps the biggest challenge in 2014 will stem from expectations of volatile market conditions. While market valuations are attractive—at least by some measures, such as free cash flow—many investors are fearful that the strong rally off of 2009 lows is due for a substantial correction. Add to those concerns fears over the eventual tapering of fiscal stimulus known as quantitative easing and the result could be a year dominated by investor angst that will require considerable risk management as well as client education.

From a risk management perspective, advisors have limited options. Moving to bonds could be a blunder if tapering causes interest rates to spike. In addition, bonds and cash may trail inflation, so investors with excessive allocations to those asset classes may see the value of their earnings erode over time or, at best, fail to generate sufficient returns to accomplish long-term goals.

Some investors may instead focus on defensive large-cap stocks and include hedged equity funds. Such funds often entail the use of shorting, so they may help cushion against the impact of market declines. Building diversified portfolios that include allocations to non-U.S. markets may also potentially help to manage risk.

Managing clients’ fears is another challenge related to volatile market conditions. Advisors are likely to find themselves spending considerable time with their clients discussing the merits of equities and the reasons to avoid being over allocated to bonds and cash. In doing so, advisors should be prepared to discuss the long-term historical outperformance of equities and to explain how waiting out market downturns has typically resulted in investors recouping losses from temporary market declines.

While some clients may be gripped by fear, others may be consumed with excessive exuberance. After all, the raging bull market and the strong recovery in the residential real estate market are adding trillions of dollars of wealth to Americans’ savings. At such times, it’s easy for exuberance to cause clients to live beyond their means and throw caution to the wind.

Advisors, therefore, will face the challenge of convincing their clients that sound financial planning principals should be followed even during times when equities and home values are soaring. For example, no one can say with certainty how long the good times will last, so investors should stick with their budgets and savings plans. Indeed, the job market is still fairly weak, economic growth is slow, and most Americans are falling short of saving enough for retirement, even with the strong bull market helping to swell their savings.

Long term, or evergreen, challenges will also persist. Many advisors will struggle to embrace online marketing, which entails a delicate balancing act of providing compelling content while keeping regulators at bay. Rather than find silver bullets to address those issues, most advisors will rely on networking, trade publications, industry events, and consultants. In other words, advisors will have to make a substantial commitment to building their online presence while understanding regulatory restrictions for marketing through social media.

Advisors are also likely to struggle with issues over upgrading technology tools as the use of wireless cellphones and tablets continues to proliferate. Indeed, many clients may even look down upon advisors who conduct meetings on old school laptops or desktops. While it may be easy to get overly excited about new technology, the key for many advisors will be to take a detached and rationale approach to purchase new business equipment. In such cases, a deliberate and thoughtful approach may help advisors make costly decisions in haste.