Aging Clients: How Financial Advisors Can Succeed in Difficult Conversations

Marketing • Posted on Oct 1, 2015

It’s a fact of life. None of us are getting any younger. Life marches on and cognitive disabilities can set in. Financial advisors can spot dementia if properly trained. In addition, they can stop their older clients from harming themselves financially – and from claiming the advisor (or others close to them in their personal life) had something to do with their undoing.

The legal and compliance risks to an advisor’s practice are very real. Forward-thinking advisors will ramp up their skills now.

Here are some tips from Carolyn L. Rosenblatt and Dr. Mikol Davis who together develop educational materials for financial advisors and speak at financial services industry conferences in a attempt to reduce elder abuse, and to also reduce legal and compliance risks for financial advisory firms and allied institutions. Rosenblatt is an RN, an attorney and a consultant on aging issues. Dr. Davis is a licensed, clinical psychologist with thirty-seven years of experience in the mental health field. More information about their work can be found at and


Financial advisors may notice the warning signs of cognitive decline in a client for some time. When they conclude that their aging client is getting to the point when he or she is unable to safely manage financial decisions any longer, the time has come when someone must take over for the client.

Typically a responsible client has an estate plan and someone is appointed as the client’s successor. One important step for the advisor is to find out if the client has indeed created this. It may be a successor trustee for a family trust or it may be an agent on a Durable Power of Attorney. However, for many reasons, even otherwise responsible people just don’t get their estate planning done.  If the client has not completed the required estate planning, this is a step the advisor can take that will protect both the client and the advisory firm. The advisor, with the help of their legal and compliance department can develop an institution-specific document that allows the client to appoint the appropriate successor to take his or her place for management decisions over the funds the advisor controls and to waive his or her right to privacy with that appointed agent. This is essential. The advisor can’t do the job of protecting the client without it.

Once the advisor is informed about the agent the client has appointed to take the reins in the event of his or her incapacity, the advisor needs to take the initiative for the next steps.


Here are four critical things a smart and ethical financial advisor can do to make the transition more likely to succeed:

  1. Recognize and acknowledge that this transition of power is difficult for anyone.
    “If the client, whom you may have known over decades, has been a powerful person in his or her life, and has been “the boss” in one way or another, giving up the status and position of being in charge will never be easy. Let the client know that you understand this,” said Rosenblatt.“Communicate that your effort is to protect his hard work and the prudent decisions he has made over the time you have known him,” said Dr. Davis. “This acknowledgement lets him know that you respect that this is emotionally trying for him. The trust he has in you will help you both.”
  1. Set up a face-to-face meeting, if possible, with your client and his or her successor.
    “The time should be chosen carefully,” warns Dr. Davis. “Be sure that there are no immediately stressful life events going on with your client that might distract from the importance of the meeting. An illness, loss of a spouse or family member, a divorce or other traumatic incident will absorb your client’s attention and could interfere with your effort to succeed.”“Find out how your client is doing in general, and select the right time accordingly,” underscores Rosenblatt.
  1. Choose the place for a meeting carefully.
    “Your aging client is already dealing with loss of control, probably in more ways than financially,” Rosenblatt continued. “If you have observed obvious changes in your client over time, there are likely other parts of his life that are a problem too.”“Let him choose where to meet. Do what you can to ensure that he is comfortable and that there is privacy. Encourage him to tell you about his concerns and fears in arranging the meeting. Be an excellent listener,” advises Dr. Davis.
  1. Expect resistance and do advance planning on how to manage it.
    “No one wants to think of herself as being too old to do what she has always done,” Rosenblatt said.“No one will relish the idea of a difficult meeting in which she must acknowledge that she has to yield control over finances,” echoes Dr. Davis. “Vulnerability is the result.”“If your client pushes back at the suggestion of a meeting, let her know that you understand why she might not want to have it but that it is going to be necessary, and soon. Set a date for follow up. Don’t push too hard, but gently persist,” Rosenblatt emphasized.


Aging clients will very likely need someone to eventually assist with financial management. This is something to plan for as an expected development, rather than a “maybe” or unlikely possibility. Financial advisors who are prepared for how to handle this potential transition of control can help to ensure their clients are protected from dangerous money decisions that arise from cognitive impairment. Astute financial advisors will be prepared to manage any transition as gracefully as possible.

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This post was authored by Marie Swift and originally appeared on GuideVine.

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