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6 Benefits Financial Advisors Provide Their Senior Clients

Date: June 24, 2021

When clients retire, their needs tend to shift from planning and preparation to management, budgeting, and savings. Even though the specific needs change, a great financial advisor is still key to their financial health. However, it can be hard to communicate that value effectively since you’re no longer talking about maximizing returns on a portfolio. 

What is it that you do for your senior clients and how can you talk about those services in a way that clearly communicates why you’re the best choice? Here are some of the key services senior clients need along with some tips for communicating that value more concretely:

#1 Create Retirement Spending Budgets

It’s one thing to estimate how much a client will need for retirement. Even if you consider tons of possible factors like unexpected medical problems or unforeseeable expenses, the actual monthly spending of a retiree can still look very different from what that client expected to be spending when they started planning for retirement decades ago. Moreover, it can change over the years of retirement. 

Creating a realistic budget from the beginning ensures clients don’t risk running out of money during their retirement. It also creates peace of mind, knowing that if they do stick to this spending plan, they don’t have to worry about whether they’re going to run out.

When you talk to clients about the value of professional budget planning help, make it specific to their situation. Talk about any retirement plans they have, including travel or hobbies. Talk about how their needs might change over the years of their retirement. 

#2 Set Up Tax-Efficient Withdrawals

Once it’s time to actually start tapping into retirement savings, clients can benefit from advice and assistance in making those withdrawals in a tax-efficient way. For those with experience helping their retired clients, you know this isn’t as straightforward as it seems.

In some cases, clients may want to hold off on collecting their social security benefits in order to receive the maximum amount. In other cases, it might actually make more financial sense to take the smaller social security check in order to lower withdrawals from other retirement accounts, thereby keeping the client in a lower tax bracket.

Without a professional financial advisor with experience setting up tax-efficient retirement income, identifying the best withdrawal method and retirement accounts quickly gets complicated and confusing. 

When talking about the value of this service, rely on real numbers. Tax bracket management alone can save clients thousands each year. For clients who are no longer earning, savings like that are crucial.

#3 Advice on Estate Planning

While many of your clients may have already drafted up a will and made plans for their estate, it is beneficial to double-check all that paperwork, make sure the appropriate beneficiaries are listed where they need to be, and otherwise reassure your clients that their estate is in order. 

Moreover, estate planning during retirement is an important opportunity to take inventory of the client’s assets and accounts. For those who worked multiple jobs, had multiple streams of income, or have multiple accounts and properties, it’s easy for something to slip through the cracks—especially when a client prepared their will and other documents long before retirement.

For clients who are planning to donate any portion of their estate to charity, for example, a financial advisor might even arrange for qualified charitable distributions during a client’s lifetime to help offset taxes. 

Financial advisors should remind clients at or near retirement that it’s a good time to review their documents and make any distribution arrangements necessary to help the client save money while also ensuring their wishes are carried out.

#4 Healthcare Planning

Many people know that medical expenses are one of the line items in your budget that will increase as you age. As a financial advisor, you can help your clients find the best insurance to cover any of the costs that won’t be handled by Medicare.

The insurance you recommend could end up being a combination of different plans to keep the client’s costs down while meeting their particular health needs. In other cases, it might be helping clients with preexisting conditions find the most affordable insurance options. 

In all cases, your expertise can end up saving clients a lot of money each year, throughout the course of their retirement. Not only that, but you can ensure that they get the coverage they actually need so they aren’t wasting money on an insurance policy that doesn’t actually meet their needs.

#5 Filling in Retirement Savings Gaps

For every client who began saving for retirement early, there are a handful of others who waited too long, who didn’t save aggressively enough, or who didn’t allocate assets in a way that would help them achieve the comfortable retirement they hoped for.

In this case, your job as a financial advisor is to help them figure out ways to maximize what they do have and to potentially increase returns where possible so they can continue saving while retired. 

#6 Fraud Prevention

While no one likes to think they could fall victim to fraud, seniors are much more likely to be targeted so the risk increases with age. As a financial advisor, you’ll be able to quickly spot any suspicious activity or strange payments. When you do, you can talk to your client and help them both stop the fraud and report it to the proper authorities. 

According to the U.S. Consumer Financial Protection Bureau, seniors over the age of 70 lose an average of $41,800 to fraud and theft. So, there is real value for clients in having that security of knowing a second set of eyes is keeping watch on their account to stop theft or fraud before it drains their retirement savings.

You can find more tips on identifying your value and communicating it to clients in this post I wrote on the topic as well as by subscribing to my newsletter.

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