We’ve all had them. Those clients who seem to be more and more forgetful. They’re with it some of the time and other times, not so much. They call you multiple times asking the same questions. They repeat their stories to you. It gets scary is when they start wanting to do dumb things with their money.
Unfortunately most firms do not have clear and specific protocols for you to follow when a client begins to show those telltale signs that he’s slipping mentally. Or that she is flat out vulnerable to manipulation by some unscrupulous person. You see it, but what can you say? You just carry on hoping it will get better or that family will take care of it. But that doesn’t happen. Then what?
At AgingInvestor.com we think it is far too dangerous for you to simply ignore the problem, or expect someone else to take care of it for you. If a scammer takes Dad, you will know when those strange and unexplained large withdrawals start coming out of his account. Family can reasonably expect that you will do something to keep your client, their father safe financially. That’s fair enough, but how do you start?
First, you need to document every instance of anything that you observe that shows you that your client’s ability to make financial decisions is becoming impaired. You don’t need to be an expert to see what’s obvious. Multiple phone calls in one day with the same question is an example. When you explain something slowly and clearly enough for a high school kid to understand and your formerly sharp client doesn’t get it at all, that’s another example: easily confused. There are numerous signs.
When you have collected the signs over a period of say, six months or more, and you have carefully recorded them somewhere, it’s time to bring your client in for a face-to-face conversation. If you are at a distance, this may have to be by phone but it has to happen.
Start with your concerns. For instance, you can say “Jack, I’m getting concerned about some things I’ve noticed with you over the last few months. I’ve heard you ask the same thing multiple times in the same day. I have noticed that you are forgetting some important things I’ve explained to you about your portfolio.” Jack may push back and probably will. You follow up by calmly showing him or describing to him the dates and your documentations of instances. “See here’s what I mean. This is worrisome to me Jack. My job is to be sure your money is safe and that no one tries to rip you off. When you forget a lot, predators are waiting to target you”.
Then you bring the conversation to the ask. “Whom do you trust that we could involve in being a backup safety person with you, or just joining in on the decisions about your investments here that might be a reassurance for me that you are ok?”
If you were smart before the diminished capacity issue came up long ago, you would have had Jack identify two trusted others you could contact in this situation. You would have had Jack give you permission to disclose protected information with the trusted others and thus dispose of the barrier that stops so many: the privacy issue. All this would be in your client file.
People respond to this approach in various ways. If you know your client, you will know some words that may work best with him or her. The point here is that you need to have this conversation, which may initiate a series of steps to keep that vulnerable client with diminished capacity as safe from predators or his own foolish decisions as you can.
Here are some takeaways from AgingInvestor.com, where you can learn more on this subject.
- Face the issue that you have to address this, awkward or not. Diminished capacity must not be ignored.
- Document each and every sign of diminished capacity as you communicate with your client. Here’s a checklist to help you.
- Open the conversation by making it your concern. You are worried about the client. You want to keep him/ her safe. You want to do your professional job.
- Have at the ready your trusted 3d party contacts for your client. Get your client’s permission to involve the trusted others at the earliest opportunity.
Does this expand your role as a financial professional? You bet. But there is no escaping aging clients and the issues longevity brings. Be ready for them.
Carolyn Rosenblatt, R.N., Elder Law Attorney, & Dr. Mikol Davis, Gerontologist co-founder of AgingInvestor.com