When a client loses someone — especially a spouse — they are left with many complex burdens. Not only do they have to cope with their own grief, but there are financial and social responsibilities that need to be addressed. While helping a grieving client can be challenging and even uncomfortable, it can also be one of the most important services a financial adviser provides.
In a 2011 New York Life Insurance Co. survey of bereaved individuals, 58% of the respondents agreed with the statement, “Losing my spouse has significantly impacted our standard of living.” Surviving spouses often struggle to deal with financial challenges such as managing financial obligations and saving for children's college funds, and may put off saving for retirement to maintain the family's current lifestyle. In such cases, financial professionals can do much to help. The same New York Life survey found that while two-thirds of respondents didn't have an adviser at the time of their spouse's death, 63% wish that they did. Of those who did have advisers, eight out of 10 said that their guidance was critical in dealing with financial matters.
Being able to give grieving clients time, advice and support can be instrumental to maintaining strong relationships and helping them overcome financial challenges. Even if your client doesn't need your immediate professional advice, they will appreciate your attention and sympathy. So what should you do?
Acknowledge the death. If a client hasn't contacted you directly, a simple letter expressing sympathy and remembering the deceased is a good, low-key way to remind the surviving spouse that you are there to help. When meeting with a client in person, offer your condolences, but give the client space to talk about their spouse before moving on to business.
Be a comforting presence. Clients and prospects may be overcome with grief, especially soon after the death. When they are ready to meet with you, offer to meet them at their home or in another place they find comfortable. If you will be meeting with them at your office, be sure that your phones are off and that your employees understand not to disturb you. Focus on listening sympathetically and allowing them to guide the conversation, especially if they want to talk about the deceased loved one. This is an opportunity to show your client that you care and that they can rely on you for sympathy and comfort.
Be patient. Your clients may find it difficult to make important financial decisions, especially during the early stages of grief. Don't be afraid to ask pointed questions, especially if you are concerned about their immediate financial needs, but respect the client's need to take things at a pace they find comfortable. Prioritize issues so that clients don't feel overwhelmed by the decisions they need to make. Discussing estate provisions and insurance policies may be urgent, but changing investment strategies can generally wait.
Discuss scenarios with clients in advance. Although no one wants to talk about their own death, having these “what if” conversations with clients can help them prepare for the unforeseen and ensure that their families will be protected from the financial aftermath of a death. By meeting with both spouses, and not just the primary client, you will establish a meaningful relationship with both, improving your ability to assist the surviving spouse after a death and preserving your long-term client relationship.
Recognize the specific issues facing women and widows. Advisers should be prepared to help women face a financial future without their husbands. Sadly, based on current life expectancies, women outlive men by approximately five years; at some point in their lives, 90% of women will have sole responsibility for their finances. Research shows that many women are not as involved in financial planning as they should be, often allowing their husbands
to take the lead in managing family finances. One of the best ways advisers can help is to encourage women to become involved in financial planning and encourage husbands to bring their wives to client meetings.
My client's spouse has just died. What should I do?
• Send a condolence letter.
• If possible, attend the funeral.
• Make a contribution in the deceased's name to a cause they cared about.
• Give your client space to grieve.
• Encourage your client to bring a trusted friend or family member to meetings.
• Move too quickly towards business matters.
• Ignore the death or act as though it didn't happen.
• Pressure the client into making decisions quickly.
The financial consequences of a loved one's death can be devastating, but planning and the advice of a trusted adviser can help mitigate its effects and get clients back on their feet. Even more importantly, clients will remember that you were there during one of the worst periods of their lives, and this will increase their confidence in you and improve your long-term relationship.
Robert Sofia is the chief operating officer and co-founder of Platinum Advisor Strategies, a web-based marketing and consulting firm to financial advisers.