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What it Means to Be There for Your Clients as They Age

Elderly couple review financesMost people don’t think they need to plan for getting older. That is, until they are forced to make unexpected, and potentially no-win, decisions, or, perhaps they fall victim to a scam that targets elderly people. In the best cases, the reality of aging means the person merely finds they can’t do something they used to do with ease. Unfortunately, in many cases, the reality doesn’t hit them until after they’ve experienced a problem.

Getting older can be a challenge to your clients’ personal and financial security if their physical and mental capacity start to wane. As their trusted adviser, you can help your clients safely ease into the later decades of their lives by organizing, simplifying and monitoring their finances, and building important relationships to help them address senior issues. As you gain more experience in this area of practice, you may find yourself identifying a range of later life planning services that can offer significant practice development opportunities.

Get your clients organized. This is the single most important step to safeguard your clients from running out of money and help them keep control of their finances for as long as possible. Most of the time, investment returns are based on asset allocations. Without organized finances, no client can have a comprehensive, monitored investment plan.

You can help your clients create a master list of their assets and where they are located. I’ve found that many seniors don’t know what assets they have, let alone where they are. For example, they often have stock certificates and other important documents in their safe deposit box, which is a dangerous and inefficient means of holding assets because they can easily be overlooked, forgotten or, worse yet, stolen.

As accountants, we need to guide, encourage and push clients proactively to consolidate and simplify where they have their assets. I have one very simple rule: is there a legal or tax reason the client needs a particular account? If not, that account should be consolidated into another account. While this planning might sound simplistic, it is incredibly powerful and, too often, overlooked.

Build monitor relationships. A monitor relationship is similar to an advocate who can “monitor” a situation and recommend solutions. For aging clients, creating this relationship, and in many cases, serving as one of the monitors is a way for you and others to identify your clients’ problems independently. This creates a check and balance on your client, their planning team, and the people giving them care. For example, if the client has duplicate copies of each monthly statement sent to you, and retains you to keep books and records, you will be able to identify a range of issues and alert fiduciaries or family when appropriate. Although there are online tools that can help do this, they all lack a trained professional’s touch.

As clients age, they may begin to have trouble handling some of their finances.  Having as much of their finances on autopilot as possible enables them to spend time reviewing, rather than paying their bills., For example, recommending seniors use a personal finance management tool and sign up for auto pay can be very effective. Moreover, don’t forget about life inventory and legal documents. Clients should make a list of the location of all of their important personal items and documents, and identify any preferences they have as to final disposition.

Competency. Observant practitioners can see the signs of cognitive impairment by noting changes in client conduct at meetings, nuances in how they use words or if they make mistakes in communication. Reports from physicians and care managers can be similarly useful. Have the client’s attorney provide confirmation, in writing, that the client has sufficient capacity to sign your engagement letter, investment policy statement and other important papers. If the attorney does not think the client has the capacity, then have the attorney confirm to you that the agent under the client’s power of attorney has the authority to retain you or perform other actions.

Helping your clients plan for their later years, earlier in life, is critical to their financial and emotional well-being. Be proactive and help them plan, now.

Want to learn more about this topic? Martin Shenkman presented a webcast in late 2015, “Aging and Incapacity: CPAs Role in Advising Aging Clients” Click here to access the webcast, and visit the PFP Division’s Retirement Planning Center for more information on a variety of retirement topics. The resources are free to PFP/PFS members, and excerpts for many resources are provided to nonmembers, along with instructions on how to access more information. Throughout 2016, look for additional webcasts, podcasts, and resources related to elder planning and life transitions after retirement.

Martin Shenkman, CPA, MBA, PFS, AEP, JD, Shenkman Law. Martin is the founder of Shenkman Law, where he focuses on estate and tax planning. He is the author of more than 42 books and 1,000 articles, and is a quoted expert on tax matters., His work appears in well-known publications, including The Wall Street Journal and The New York Times. Martin is also known for his active charitable work, which has been profiled in Forbes. See his blog post at www.shenkmanlaw.com

Elderly couple review finances courtesy of Shutterstock.


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