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3 Things Every Advisor Must Do With Cognitively Impaired Clients


3 Things Every Advisor Must Do With Cognitively Impaired Clients

Everyone is going to have someone in your book, sooner or later, who has cognitive decline.

Studies tell us that the average advisor has at least 7 clients with some form of cognitive impairment now.

We’d bet that when you became an advisor, your education did not give you guidance about what to do when you see the warning signs of decline in a client’s mental function. With increasing longevity, we have a problem like never before.

What are you supposed to do about it? Isn’t this the family’s problem? In truth, it’s not just the family’s issue—it’s an issue for everyone in an elder’s life, including the financial advisor. There are three essentials everyone should be doing to keep yourself and your client safer.

  1. For openers, you, the advisor must be familiar with the warning signs of cognitive impairment. At, we offer a free downloadable checklist of these red flags, so you can keep it and use it as a guide. Please do. You can’t ignore these signs, as they are very likely to worsen over time. When your client is too “out of it” to make decisions, you are in trouble.
  2. Have two or three trusted contacts in your client’s file. If you have never asked for even one, now is the time. Make it part of your office policy, your task at a portfolio review, or what you decide to do this week because you are a smart, plan-ahead person. Why two or three? Because family members are often named first and family, unfortunately, are the ones who steal from aging folks most often. One of the contacts should be outside the family.
  3. Get written permission from your client to speak to their estate planning attorney, their accountant and any other professional involved in managing their affairs. This can be extremely helpful to you as a client begins to show those red flags. All of the professionals can act together to protect the client, get an appointed surrogate decision maker in place or otherwise reduce the risks of financial fraud and abuse. All it takes to give permission is a letter from your client, a simple but very important step you must take. Draft it for the client, ask him or her to sign and do it. 

The point of this action is to protect a vulnerable client from getting ripped off, from failing to attend to financial business, and from the neglect of basics that often accompanies this kind of mental impairment. You don’t need to be a hero. You do need to be a professional in the way you treat these older clients. And remember that if the client is “losing his marbles” and money gets drained by predators, decimating the portfolio, the family may look to you if you failed altogether to act. Remember, their inheritance could be at stake.

Related: Add Value to Aging Clients By Offering Family Meetings

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