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Prepare Your Clients for These 5 Life Events

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Even though most individuals well-versed on financial investments have the “what if’s” planned out, you never know exactly what could happen. Investments and financial stability can change at the drop of a hat and consumers should be prepared for all types of situations that life throws at them. While clients may have some knowledge, a lot of them only look at the big picture, which is retirement. They walk into your offices and have the mental image of filling up the pages in their passport, and the serene vistas from their beach houses.

Although retirement is a large focus when it comes to planning your client’s finances for the future, there are also several events throughout their lives that are both expected and unexpected. These deeper conversations of discussing the “what if’s” can at times be challenging, especially when it comes to discussing planning for the possibility of costly health issues, and even the loss of family members. As a financial advisor, it is vital that these conversations are had in order to provide a robust financial plan to last them the rest of their lives.

Here are a five of the “what it’s” that financial advisors need to cover in order to provide their clients with the most powerful plan:

1. Wedding Bells Ring, Your Credit Card Sings

Most parents of daughters approaching their 20s have the thought in the back of their mind that their little princess will find her Prince Charming. Parents will be throwing out money left and right to make sure their little darling’s wedding is one for the books. Or, let’s say, love finds you later in life and you decide to pay for a wedding for yourself.

No matter the circumstance, planning a wedding is a very costly life event. According to The Knot, the national average for wedding costs hit $35,329 in 2016. So long, mid-life crisis vintage Porsche, hello Swarovski crystal everything. While this may cause your client to take out a personal loan, or dig into their retirement, this is an event that should be accounted for.

2. What You Don’t Expect When Your’re Expecting

Building a family is in the life plan of most individuals. After getting through the wedding, maybe buying a house, and establishing some savings, the time comes to bring a little bundle of joy into the world. For some women, conceiving is not a problem and everything happens with few complications. For others, trying to achieve their dream of becoming a mother takes a little bit of science, and science means money.

This also doesn’t take into consideration families wanting to adopt, or if the mother plans to stay at home and not have a second income for extra financial support. Whatever the situation, financial advisors need to have these in-depth conversations to account for the couple’s plan for child-bearing.

Even if the mother does plan to work, her projected income will decrease and medical bills will increase. All of these financial factors and hypotheticals need to be planned out.

3. Medical Bills, Bills, Bills

One of the joys of parenthood is caring for your children when they’re sick or injured. Most of the time these types of things are temporary, and don’t require much medical involvement, or attention. However, there are some cases where your client’s child is triple-dog-dared to jump out of a tree and wind up with broken bones and several surgeries.

For complicated injuries, cancers or extreme illnesses, families take a major hit on expenses. These things are hard to predict, but advisors work to create a cushion to account for these “unpredictables.”

4. U-Hauls and New Adventures

New jobs, jobs requiring you to move, or moving to the place you’ve always dreamed. Some planned, some not, the expenses to move or take on a new job opportunity affect finances tremendously. Let’s say your client accepted a new job that requires them to take a pay cut. This impacts their earning potential and sets them back a little further than their original plan. If the client loses their job, they could completely deplete their savings.

Keeping tabs on the economy, as well as the success of their industry and employer, along with aligning with their goals are important parst of their overall financial strategy.

5. Losing a Loved One

The topic of losing a loved one is one of the most difficult to discuss with clients, but it is incredibly important to plan for. Death is a part of life, and with care and sensitivity can be planned with ease.

Between the cost of a funeral, potential medical bills, and overall loss of income, or even the case of a large inheritance or life insurance policy, these tricky situations need an in-depth look by financial advisors. Even for younger clients that still believe they’re invincible, it is important to walk through the hypotheticals.

Identifying unique circumstances and incorporating them into your client’s portfolios ensure they are ready for whatever life throws at them. This is why it is important to incorporate human capital factors and assess the risks unique to individuals such as their career, health history, financial responsibility, and even job sector. Through these human capital factors, and even hypotheticals, risk can be adequately assessed to calculate how much of a loss an individual can tolerate without taking a major hit to their life plans.


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