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January 29, 2018 at 07:00 PM
It’s one more phone call where you, the advisor, have to listen to the same story/complaint/worry/idea (pick one or all).
The meeting lasts far too long as the nomenclature and numbers in the performance report are explained for the umpteenth time to the elderly client.
The relationship deteriorates with one missed call back or minor clerical error by your back office. Sometimes the account is terminated on such trifles.
New state regulations threaten potential litigation if you fail to report elderly abuse.
Family members of your elderly client try to use you as a pawn in the power struggle among ex-wife and grown children, siblings and step-siblings — or worse, see you as the impediment preventing a more rapid receipt of their inheritance.
Your elderly client is desperately lonely and isolated from normal social interaction, with one exception — you and your team are called upon all too frequently.
How should you respond to your elderly clients’ unreasonable demands — more face time, more frequent phone calls, more customized, labor intensive reports? How can you retain assets when your client’s next generation family members view you as irrelevant and as out of touch as their elderly relative? How can you surmount all these challenges while still running your advisory business?
More challenges loom with dramatically increasing longevity and women still living longer than men. No longer will men be the majority of the firm’s clients, and owners of many advisory firms are aging right in step with their clients. Are your succession plans going to work or will aging founders be as burdensome as the elderly clients?
Even baby boomers now recognize that death is no longer an “if” but rather a “when,” which gives you an opportunity as the advisor to be an important catalyst. You need to engage the spouse, the grown children and other key family members, or you risk the abrupt dismissal by surviving family members, who do not know you, much less care about your business. A 2015 survey revealed 66% of grown children fired their parents’ advisor after receiving their inheritance.
Ageism is gaining attention in the media with AARP leading the charge. Nearly two thirds of workers over 55 report being victims of age discrimination, according to a “Forbes” article. With nearly a fifth of the U.S. population over 65 and expanding every second, social security and Medicare are in fiscal crisis. To add fuel to the generational divide, the term “greedy geezers” was coined to describe how the elderly are pushing the rest of the country to the brink of bankruptcy.
Because the majority of wealth still is held by these aging baby boomers, who will live far longer than their parents, the tension between generations will become even more toxic. Baby boomers, who once chanted “don’t trust anyone over 30,” are now outnumbered by millennials, who can view boomers as irrelevant and out of touch.
Perspectives are changing: the adage, “Youth is wasted on the young,” has been replaced by, “Financial resources are wasted on the old.” To engage the younger members of the family requires an advisor to first find ways to connect. That could be increasing the visibility to your clients of younger colleagues or designing events for younger clients.
Adding to the family tension, the declining mental state of the elderly spares few, if anyone. Wall Street Journal columnist Jason Zweig cited research that the cognitive slippery slope begins at age 55! Adding to erratic financial behavior is an attitude of stubborn denial. “I can, too, drive perfectly well!” or “Don’t tell me I need elder care; how ridiculous a notion!” insists your aging client, much to the frustration of both the family and advisor.
