Comments like Pool’s are invaluable. In our industry, we’re all looking for that thing that will make us better and different. Giving advice, or sharing another professional’s comments, may not fit into every conversation with a client who is facing life-altering circumstances. But sharing relevant points of view in a blog post, social media or newsletter can deliver more value than just another stock or bond tip. In the most recent issue of my Naked Retirement newsletter, I do just that. I reveal that the most interesting thing I learned this week is how accepting help can create positive karma. Admittedly, I’m one of those people who are hesitant to accept help of any kind, but Smith’s insight changed my perception. Her simple statement put a fresh spin on a troubled time in someone’s life and those around them. Since, for the most part, advisors don’t drive clients around, cook or clean for them, the challenge is to be able to adjust our skill levels and expertise to match the situation.
My client’s disclosure about his cancer didn’t require an immediate portfolio change, or the need to bombarding him with time-sensitive financial decisions. I did, however, want him to understand the cash-flow flexibility we could create, and that I stood ready to run numbers, make calls or discuss options whenever he felt in need of counsel on money matters. Having a strategy/philosophy in place before being confronted by people facing their own mortality will provide not only you with peace of mind, but clients as well.
Many costs related to treating the seriously ill depend on the patient’s medical insurance limits and proximity to treatment facilities. (Long drives to and from chemo or radiation centers increase costs.) Be ready to help clients find the funds necessary for higher out-of-pocket expenses, such as co-pays, prescriptions and medical equipment not covered by insurance, and experimental or non-traditional medicine. It may be the best thing an advisor can do to help those who will do whatever is necessary to alleviate a bad situation.
Whether it's cancer or another serious medical challenge, advisors should be open to adjusting the client’s holdings, particularly in favor of liquidity. It may mean not re-investing dividends, changing from a model to a non-model portfolio, digging into a contract to identify penalty or tax-free withdrawal amounts and timing, or limiting 401(k) contributions in order to redirect funds to other savings accounts. Regardless of method, be prepared to alter your focus from helping a client plan for the future to improving their current well-being.
When a client’s retirement plan suddenly changes, it’s important for advisors to know how to handle both the initial discussion and subsequent planning conversations. By being genuine, present and offering clients an opportunity to share what they’re thinking and feeling, advisors can create the space for the relationship to strengthen and grow. Demonstrating empathy, avoiding advice on doctors or medications, and sticking to your area of expertise are what’s most needed by clients who face suddent changes in retirement.
P.S. Have you had a similar or different experience with cancer or another major life change for a client? I’d like to hear how it went and what worked. Leave a comment or e-mai me. Also, be sure to check out my previous articles at FA here as well as my free guide, Three Things No One Tells You About Retirement.
Follow Robert Laura on Twitter @robertlaura. He is the president of SYNEGOS Financial group, co-founder of RetirementProject.org, and author of Naked Retirement. He can be reached at [email protected].