One of the most challenging and important roles a financial advisor can play is helping clients when a loved one passes away. Whether it’s losing a parent, spouse or child, dealing with grieving clients often means offering both wealth planning and emotional support. How this support is provided can make or break a relationship.
It’s a reality advisors will be dealing with increasingly as the baby boomer population continues aging, says Sara Gilbert, a business strategist and certified coach with Strategist Business Development in Montreal. “Advisors need to understand their role is becoming more of a coach or mentor than anything else. They need to be ‘people people.’”
Dealing with grieving clients starts with knowing the best way to approach the family, based on the advisor’s relationship with them. Ms. Gilbert says advisors should call the surviving family members soon after the death to offer their condolences.
“Whatever you do, don’t bring up money,” she says. Her advice is to wait until the client appears ready to talk about their financial picture, which could be weeks or months later.
When the financial planning conversation is scheduled, Ms. Gilbert says advisors should take it slow by asking small, open-ended questions.
“Start by asking them not just how they are, but how are they doing. The key is the simplicity,” she says.
Then, with the financial plan, Ms. Gilbert suggests asking questions like: “Is there anything you’re worried about?” or “Are there any changes you’d like to make?” If enough time has passed since the family member’s death, you could ask, “What do you want to do?”
When a loved one dies, people tend to assess their own lives and priorities and make bucket lists of things they want to do or accomplish, such as volunteering overseas, helping their kids buy a home, or starting a business – all of which could require changes to a financial plan, Ms. Gilbert says.
“Listen. Ask open-ended questions. Let them talk and get out the emotion they might have, then open the bucket list,” she says.
Jeet Dhillon, vice-president, senior portfolio manager, at TD Wealth Private Investment Counsel in Toronto, says advisors should have the client’s financial information readily available in case they want information on their status immediately. Some clients might be concerned about cash flow, for example, or want to know where their money is invested if they weren’t handling it directly.
“You should know what that looks like and have that information at your fingertips,” Ms. Dhillon says.
From there, it might take a few meetings over several weeks or months to develop an updated financial plan, particularly for a surviving spouse whose lifestyle and expenses could change dramatically. Take it slow, Ms. Dhillon says, allowing them time to adjust to their life without their spouse.
“Don’t feel you have to solve everything on day one,” she says.
Ms. Dhillon also says advisors should get to know the entire family – not just the husband or wife, with whom they may deal regularly – before a death occurs. She highlights an often-cited industry survey showing 80 per cent of widows switch advisors after their husbands pass away, which she believes is because the advisors didn’t get to know them.
“You don’t want to get to that point,” Ms. Dhillon says. “As a best practice for advisors, get to know both partners, get to know the family. When something significant like this happens you want to be one of the people they call.”
The most important job for advisors dealing with grieving families is to be accessible, but not overbearing, says Jeff Hull, a senior financial advisor at Manulife Securities Inc. in Mississauga.
“Don’t overstep,” Mr. Hull says. “Sometimes advisors want to sweep in like Superman and save the day, but families deal differently with grief and grief has different stages. ... As an advisor, you have to be sensitive to that. Be in the background. Make sure the family is aware that you care, that you’re there and that you’re just a phone call away.”
Grieving clients often look to advisors to let them know they’ll be okay financially when a loved one, such as a husband or wife, passes away.
“That’s where an advisor can really step up and help provide that grieving family with some true comfort,” Mr. Hull says.
Clients who have an estate plan in place are sometimes eager to hear from their advisors, for example, if they’re receiving a life insurance payout.
“The comfort, you can just see it wash over them,” Mr. Hull says, particularly among those who may have cash flow concerns.
Mr. Hull also says advisors should check in with grieving clients from time to time, including on the anniversary of their loved one’s death.
“The first anniversary is the most difficult – and that’s the one to remember most,” he says.
And while death is always hardest for the family members, advisors should acknowledge that it’s a difficult part of their role, too, and that they need to be prepared for when it happens.
“For an advisor, it can be scary, too, because death isn’t a comfortable subject for anyone. Just go with your heart and your gut in doing what’s right,” Mr. Hull says.