September 8, 2020

Client handholding: In good times and bad

Mohini Mahadevia

Founder at SOLUFIN

As advisors, we are expected to lead the client to experience financial success and bliss, financial freedom and the realisation of their dreams. While this cannot be disputed, there is another very important responsibility that we must fulfil at all costs- leading them through personal crisis and disasters. More often than not, these come out of nowhere and hit the client in the face. It could be the death of a loved one, loss of a job, business trouble, family disputes, divorce or other events of seemingly smaller magnitude that can shake up the client’s world. Inevitably, they are bound to have far reaching effects that trickle down to their financial stability. Yes, money isn’t everything, but it is a lot of things. And while we may not be able to help them fight the actual battle that they’re facing, it is pretty much our job to safeguard their money, financial safety and security from any potential threat- grief, bad products, opportunistic product pushers, unscrupulous relatives, the client’s own fears that can make them take bad decisions, etc.

For the moment, let’s talk about leading the client through one of the biggest losses in life- the loss of a loved one. Sudden death or not, the biggest blow falls on the loved ones who survive it. We would possibly not be able to provide emotional support (though some advisors wonderfully also play the emotional anchor of their clients’ lives), we have to step up and take the responsibility of ensuring that they face no further blows atleast financially. Right from last rites’ expenses to managing life insurance claims, obtaining a death certificate, other legal factors in case of accidental deaths, etc., the smooth transmission of assets from the deceased to the heirs, handling any major lifestyle changes (like having to reduce working hours, shifting homes, setting up care for dependents, etc.) the tasks at hand seem endless to the client and they can often crumble under this mountain of responsibilities.

Advisors must nudge the client to start tackling these issues in a timely manner and guide them through the processes. We should be able to separate these tasks from emotions. The client needs this practical and subjective approach. So, if they have to shift homes, for us it won’t be leaving the house they grew up in but a call of necessity to ensure that family is taken care of or expenses are controlled. Selling off assets will not be parting with the legacy in our eyes, but the generation of financial stability that can probably replace the income of the deceased person. In times like these, clients are not in the frame of mind to be able to see these decisions and tasks objectively. Emotions can sway them to not take the right call at the right time, fear of their family losing them too can goad them to buy wrong products as it gives them a false sense of safety, the emotional toll that certain tasks like transmission of assets and probate, etc. take makes them not complete the formalities so required to keep the assets in clear and undisputed holding.

We must lead them through these times and prepare them for the life ahead by discussing the drafting of Wills, nomination updation, having a list of assets and liabilities in place, etc. for them and the remaining survivors. We all owe it to our clients and their loved ones to protect, nurture and grow their wealth. It is our job here to step up, step in and handhold them through what’s needed to be done, and do it we must!

What according to you can we do to make our clients’ lives easier in times like these?