5 ways to better serve aging clients

5 ways to better serve aging clients

If you plan to support this maturing demographic, here are five key considerations.

  1. Develop deeper KYC conversations for better client outcomes

Truly understanding a client’s goals and aspirations is foundational for creating a holistic financial roadmap for them. This is where the more in-depth know-your-client (KYC) requirements introduced through which client-focused reforms (CFRs) can work in your favor to provide greater insight into their needs.

What does retirement look like for them? Just because a client is in or approaching retirement does not mean that their financial needs will be the same as someone else at a similar age or stage. That’s why it’s valuable to have a very specific KYC conversation and understand their vision of retirement.

Be prepared to do more in-depth financial planning and goal setting. Look at the whole picture, weaving wealth and health together. For example, reviewing their insurance protection needs is a valuable part of the holistic planning process.

  1. Plan for client income across a longer life span

People are living longer lives, thanks to advances in medicine and health care. People over the age of 100 are one of Canada’s fastest-growing demographic groups.

Although the markets are challenging right now, advisors shouldn’t put portfolios into cash or “safe” investments such as GICs, given longer life expectancies. Instead, consider an investment approach that incorporates return potential into the portfolio and that will provide a client with income for an elongated life span.

  1. Explore new product strategies while meeting KYP obligations

Advisors are looking for ways to provide potential returns for clients with limited volatility. While there aren’t likely to be any magic bullets, you can continue to focus on diversification: explore products that incorporate other asset classes and different geographies.

Educate yourself about the various decumulation strategies and options that are now available. Think about whether there are products that are more appropriate for the decumulation phase.

Remember that any work you do on new product strategies will have to meet the upgraded know-your-product (KYP) obligations under the CFRs. And once you are comfortable with new strategies, remember that not all of them will be suitable or comfortable for all clients.

  1. Include families in financial conversations

Given the looming intergenerational transfer of wealth, you want to be positioned to assist younger clients in their investment journeys. To keep clients’ family members as part of your practice in the future, be sure to include them in financial planning and goals conversations where possible. This gives you the opportunity to create a relationship with them and help them understand the value you provide.

Once a client’s family members have been engaged, there’s a better chance they won’t move to another advisor once the client passes away or no longer has the capacity to make decisions.

If you’re a mature advisor with a predominantly mature clientele, you could consider bringing a younger advisor onto your team to work with younger family members as part of your succession planning.

  1. Broaden the scope of your client communications

On the communications front, start thinking about client messages that go beyond market updates and that cover a more holistic range of topics. For example, you can provide clients with insights on how to stay healthy or leverage insurance to fund future tax bills — or even provide travel tips, if that’s of interest to clients.

Tailor messages to clients depending on their interests and goals for wealth and well-being. The more specific their needs are, the more specific your messages can be.

Be sure to leverage your firm’s communication platforms wherever possible. These communications are often automated and can be readily tailored to specific client segments. This can be an effective engagement tool and value-add for clients, without creating a lot of extra work for advisors or their teams.

Susan Silma is head, regulatory business practices, with Sun Life Financial Investment Services. She is a lawyer and former regulator, and is passionate about integrating compliant practices into a positive advisor-client relationship.