Financial advising and wealth management with clients impacted by dementia
Recently, a new requirement states that each wealth management client needs to name a “trusted contact” to be contacted if their advisor suspects fraud is occurring or there is cognitive decline in the client. Some companies take it a step further by training their advisors on recognizing signs of cognitive decline and services available to help support them.
Types of wealth management clients that a dementia expert can help.
I have been working with financial advisors for some time now. There are a few types of clients they may encounter who Trovato can help.
Clients who are expressing concern about their parents, spouse, or other relative.
This may be the client who is venting about their parent’s current living situation, considering or looking at assisted living, wanting to bring in home care, frustrated with the current care provider, experiencing problematic behaviors from the person with dementia, or just generally worried about their safety.
They may ask you to create a plan that allows for a certain time of care because they are upset about their parent’s current situation. They may mention they’re seeing signs in their loved one so they want to plan accordingly.
Clients who are raising children while also providing care for a parent with dementia.
This is known as the sandwich generation. They are planning for their retirement, their children’s tuition, and caring for an aging parent. They may be supporting them financially or just in a caregiving role.
Again, they may ask you about planning for themselves and be exploring options for their parent. They might even be frustrated with their parent who is living at home and could express this to you.
Clients who are showing symptoms of cognitive decline.
You may start to notice changes in your client that are unusual while other times, they may notice the changes or they may already be diagnosed. This can be tricky for a financial advisor as you are not equipped with all of the education tools to communicate effectively with a person with dementia. But this could be a good time to reach out to the trusted contact and introduce a dementia consultant.
Signs that your client may be experiencing cognitive decline
The signs a family member, friend, or colleague may notice that could indicate a cognitive decline may be different than what a financial advisor may experience. In some cases, a financial advisor may notice something sooner. Close relatives naturally compensate for one another, which could mask cognitive decline sooner. As an advisor, you won’t have this natural tendency and the need for thoroughness could give you the opportunity to notice sooner.
Not all types of dementia present with memory loss. So being forgetful isn’t the only sign we need to look out for.
Your client may start making decisions that don’t quite make sense. One financial advisor had an 80-year-old client who got into a very minor car accident with a 4 year old Honda. Instead of paying the $500 deductible and getting the car fixed, she traded in the car as it was and purchased the same car (make and model) but a brand new one. You may find your client making decisions that just leave you scratching your head. Especially alarming is when this is not their typical nature.
Requesting large sums of money
This sometimes goes hand in hand with poor decision-making. Other clients may have so much money that they have a lot to “play” with. So, when they are asking for large sums of money it may seem normal but understanding what it is for could be helpful. I received a call from another financial advisor because their client wanted a large sum of money to buy a new Mercedes for their neighbor. This person had plenty of money to do this, but they weren’t usually this generous. So, that was a red flag.
Forgetting entire experiences or conversations
It can be normal to forget bits and pieces of what is said, but, if your client is calling you to go over the same information over and over, that may be a sign that something isn’t right. Forgetting that they met with you altogether or forgetting the entire conversation are things to be concerned about and may be a reason to contact their trusted contact. This can also look like repetitive questions or taking a lot of notes but forgetting why they wrote the notes or forgetting that they wrote them at all. You may look down and see the answer to the question is in their notes, but they still ask it several times. Finally, they may miss appointments with you. It may be cause for concern if client is routinely missing your scheduled meetings without notice or having a tough time coordinating a time to meet you. This could also indicate a challenge in problem solving more so than memory and is still a sign of cognitive decline.
Paranoid or Making accusations
Is your client suddenly making accusations against you or other family members or are they more protective of their money or wanting to be more secretive than before? This could be a sign that something is not right. When the trusted contact is chosen, the decision isn’t made lightly. This person may need to be contacted and introduced into the scenario carefully. Paranoia is not just a symptom of mental illness but could be a symptom of dementia or a secondary reaction to other symptoms. Accusing others is a more reasonable explanation when someone is forgetting, not paying attention, or having other cognitive challenges.
How to determine their ability to make decisions
When you are working with a client and you suspect that something may not be right, you may be hesitant to reach out to their trusted contact right away. Each financial advisor has to follow their proper protocol in terms of regulations and company policies. However, some things you may want to consider in addition to those policies and regulations are:
- Does your client understand what is being discussed?
- Do they appreciate the significance of the information or request?
- Are they able to demonstrate logical reasoning for the context?
- Are they able to express a choice by indicating their preference?
In order to assess for the above, you may ask some specific questions or use some of the following methods.
As they’re making requests you may want to offer an if-then scenario. If they want to do something, have them explain what will happen. Another way is to offer the explanation in an example, then apply the example to their current situation. See if they are able to properly compare and understand the similarities between the hypothetical example and their situation.
Similar to the if-then scenario, you may give them a problem and ask them to solve it. It could be minor or major, depending on what is appropriate. You may start with a simple problem them work to more complex problems. The goal is to be sure they understand their options and the solutions associated with those options in a logical, reasonable way.
Many financial advisors, and other professionals, use orienting questions such as: “What is the day of the week?” “Who is the current President?” “Who was the past President?” Most people in the early stages of dementia are still fairly well oriented. Also, both the past and present Presidents come with an emotional reaction whether you love or hate them. So, even if someone has dementia, they may still be able to recall whom the President is/was. So, keep in mind that orienting questions may not be a good tool.
Asking your client to repeat what you’ve said to show an understanding or asking them to repeat their request with a reasonable rationale for that choice. Is the reasoning logical and in line with their usual patterns? If not, you may want to explore the possibility that this person could be experiencing cognitive decline.
Introducing a dementia consultant
Whether you’re talking to your client or to their trusted contact, introducing the idea that something could be wrong is a challenge. This idea is scary for most families and you may be the first person to notice. Financial Advisors work with clients in a capacity that may reveal cognitive decline before other professionals or family notice. A dementia consultant can help guide families to the next step. When referring your client to a dementia consultant you should encourage and reassure your client in these ways:
- It may not be dementia but something else that could be reversible but serious, so good to start the process of learning more.
- A dementia consultant can provide support and guidance on the next steps, what to do, where to go, and how to do it.
- A dementia consultant may be able to help you stay independent longer so you’re involved in decision making.
- Making multiple changes for a loved one with dementia (from assisted living, to home care, to switching caregivers, etc.) can be stressful and can become unnecessarily expensive. A dementia consultant can help you make the right decision sooner and more effectively.
- If you are already stressed out, a dementia consultant can help you learn how to do things differently and more effectively so you are less stressed.
Another suggestion I always make is to ask the client if Trovato can reach out to them. We offer a free 30-minute phone consultation that allows us to be sure we’re the right fit. If we aren’t, we will recommend another service that could help. They can also schedule a time to speak with Trovato online.