Stepping Up for Senior Investors

We know that financial advisers are knowledgeable about best practices surrounding senior investors, but did you know that best practices also include your ability to fully grasp and appreciate the natural aging process when engaging with older clients? Beyond the more obvious physical and mental characteristics, with age comes a unique set of social, familial, and generational attributes that distinguish this demographic from others we typically serve.

As many of you are aware the essentials surrounding best practices to mitigate the financial exploitation of seniors include:

  • Establish escalation, reporting and recordkeeping policies relating to financial exploitation of seniors and vulnerable clients;
  • Consider including a “trusted contact person,” and a “disbursement delay” provision and a provision relating to what occurs if the client passes away, is disabled or incapacitated in new or amended advisory agreements; and
  • Provide annual training on recognizing red flags indicating possible exploitation of a senior client, highlighting that most exploiters are care givers or family members.

To successfully execute the strategy above, the key is to maintain an open and balanced dialogue with your senior clientele.  As fiduciaries, it’s imperative for you and your team to recognize these nuances and devise effective methods of communication and interaction tailored to this group of potential clients. Enhancing your communication prowess not only fosters trust with your clients but also provides you with additional layers of protection to advocate for their interests.


Social Issues

Retirement encompasses more than just leaving the daily grind behind. It involves significant lifestyle adjustments, like breaking old routines and establishing new ones, nurturing social connections, and accepting the shift from a steady salary. It’s crucial for you to assess how much thought retirees have put into these changes. This means understanding how their financial resources align with their desired lifestyle, whether it’s choosing a residence, traveling, pursuing hobbies, or planning inheritances for their children.

For retirees who haven’t fully considered these factors, you’ll need to provide ample information and support as they navigate these decisions. Give them the space to weigh their options, both in terms of financial services and products. Unexpected life events, such as the loss of a spouse or declining health, can arise suddenly, necessitating collaboration with professionals from various fields. As a financial adviser, continuously expanding your knowledge of these issues is vital.

Yet, if you encounter challenges beyond your expertise, don’t hesitate to refer clients to specialists like lawyers, estate planners, transition experts, mental health professionals, or caregiving organizations.


Familial Issues

Retirement and aging can trigger significant changes in family dynamics, often with complex financial repercussions. Consider a scenario where a 60-year-old is going through a divorce, facing intricate financial issues related to pensions, retirement funds, and estate plans. Meanwhile, some baby boomers, even those with adult children, may embark on later-life marriages, sparking discussions on blending financial resources and managing shared expenses.

In another scenario, an 85-year-old mother living far from her daughter suddenly requires round-the-clock home care. This raises tough questions: should the daughter sacrifice her job to care for her mother, or is there a better solution? As a financial adviser, you might suggest exploring options like obtaining power of attorney or adjusting financial accounts to cover the mother’s expenses. However, these decisions can have ripple effects on tax obligations and overall financial plans, highlighting the need for careful consideration and expert guidance.


Decisions about Inheritances

The passing of a spouse can thrust their partner into a financial quandary, especially if their pension ceases upon death. Take, for instance, a scenario where a widow faces the dilemma of whether to consider purchasing an annuity for stability. It’s crucial to ensure the client has the space and information needed to make a well-informed decision. However, it’s essential to recognize that grieving clients may exhibit various symptoms, such as reduced focus or heightened emotions, which can impact their decision-making abilities.

Financial advisers should remain vigilant for signs of distress and, when appropriate, involve a trusted family member or friend in discussions, while respecting the client’s privacy. In times of loss, experts often advise a “decision-free” period, allowing clients time to process their emotions before tackling financial matters, except in cases with pressing deadlines like decisions on inherited IRAs.

In sensitive situations where concerns about the client’s capacity arise, it may be necessary to refer them to professionals like elder law attorneys for guidance, particularly when decisions regarding legal guardianship are at stake. Additionally, it’s essential to uphold confidentiality standards, as not all family members may have the best intentions when seeking information about their parents’ finances. Disclosing such information without the parent’s consent would breach ethical codes and privacy regulations set forth by SEC and/or State rules and regulations.  Again, such challenges may warrant a referral to a securities attorney for guidance.


Generational Issues

Older retirees often carry memories of enduring financial instability during the Great Depression and striving for stability post-World War II. However, financial advisers accustomed to working with this demographic may notice a shift in attitudes and experiences among the upcoming baby boomer generation.

One significant difference lies in boomers’ mixed expectations stemming from increased longevity. While they aspire to enjoy longer and more fulfilling retirements, they also harbor concerns about whether their finances can sustain their desired lifestyle. Additionally, as their parents live longer, some boomers face the responsibility of providing financial support or care, potentially depleting the inheritance they had earmarked for their own retirement.

Unlike previous generations, many baby boomers can’t rely on pensions due to changes in corporate practices. Consequently, they must navigate complex financial decisions without much prior experience. Surveys by organizations like AARP indicate that a considerable portion of boomers feel financially less secure than anticipated and anticipate working beyond retirement age.

Financial professionals assisting boomers must acknowledge these conflicting emotions and address them proactively. This entails providing basic financial education on money management, investment strategies, and a diverse range of financial products beyond mere investment recommendations. By understanding and addressing these concerns, advisers can better guide their boomer clients towards financial security in retirement.



As a fiduciary, it’s imperative that you and your team recognize these critical factors and swiftly implement strategies to effectively engage and communicate with this demographic of potential clients. Enhancing your communication proficiency is paramount in fostering trust with your clients, thereby equipping you with essential layers of protection to safeguard and step up for senior investors. The Core Compliance consulting team is very experienced in drafting policies for senior safeguards and diminished capacity and can assist firms with a variety of situations involving your senior clientele. For more information, please contact us at, at (619) 278- 0020 or visit us at

Author: Maggie Tavares, Sr. Compliance Consultant; Editor: Matthew Rothchild, Sr. Compliance Consultant, Core Compliance & Legal Services (“Core Compliance”). Core Compliance works extensively with investment advisers, broker-dealers, investment companies, and private fund managers on regulatory compliance issues.

This article is for information purposes and does not contain or convey legal or tax advice. The information herein should not be relied upon regarding any particular facts or circumstances without first consulting with a lawyer and/or tax professional.

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