When medical issues get financial

Brice Carter, CIO of Financial Strategies Group in Michigan is a second generation financial advisor. His father and brother are both financial advisors. While still in college—unsure of exactly what his career would be—Bryce started doing some administrative work for his father's firm.

"One of the first meetings that I ever got to sit in on a client came in, an elderly gentleman, he was with at least one of his adult children," says Carter. "His wife had passed away somewhat recently and she had had a pretty long battle with cancer and had spent a significant amount of time in a nursing facility. They were thanking my dad that they still had resources left ... that was an eye-opening experience."

That's when Brice made the decision to major in personal finance. Not because he loved finance in particular, but because he found the human element of the work was so compelling.

When finances and medicine mix

Any advisor who has been in the business for a while will eventually have clients with severe or terminal medical issues, says Carter.

"People never think it's going to be them. So they don't plan for it."

As often as possible, advisors want to prepare their clients ahead of time. But that's not always possible.

Carter recalls a story about a client he had when he was fresh out of college. Elderly, wheelchair bound, and residing in an assisted living facility, this client dearly wished to go back to her home. That wasn't in the cards. While Carter was able to help her with her own planning, he couldn't help but think how much more he could have helped her if they had met when she was 40.

"I couldn't go back in time and do some better planning for her, for her personal finances. We did the best that we could for the situation that she was in."

That experience shaped the recommendations he makes to his younger clients. They don't just talk about asset allocations and retirement planning. They talk about the likelihood of moving to an assisted living facility, or having medical complexities and how to pay for that.

"I think roughly 70% of people will need a care facility at some point in their life, whether it's a short duration due to a surgery or extended duration due to a debilitating cognitive condition," says Carter. "You could know those statistics without actually understanding how it really impacts people."

Bringing in other family members

One of the more challenging aspects of working with aging clients or those with a medical condition, is the need to bring other family members into the conversation. In the event the advisor notices cognitive decline, for example, they'll want to bring others into the planning discussions.

"Some are going to be very, very open to it and realize, yeah, maybe they start to need help," says Carter. "And there's going to be some resistance there."

Carter finds that clients who have already had experience with their own aging parents are more receptive to bringing in adult children. But it still creates some emotional difficulty.

Now, when Carter brings on new aging clients, he tries to bring the adult children and lawyers in immediately to get those plans made proactively in the event of cognitive decline or medical challenges.

"Now I'm starting to see where these elderly clients are in a much happier position because they're not worried and stressed about their finances and they have help doing that. And so I think that there's a drastic improvement on the quality of life. And I'm able to see those impacts pretty regularly."

Getting ready for difficult conversations

While there are plenty of educational resource out there to help advisors train up on how to have challenging conversations with aging or medically complex clients, experience often serves as the best teacher. For Carter, his sincere belief in the importance of end-of-life planning wasn't always communicated in an effective way early in his career."

"I was pushing clients too much on that. I think that ended up hurting some of my client relationships. I can't say definitively that I was fired by a client for that specific reason," says Carter. "So I think I learned how to be a little bit more tactful on that particular conversation. I also learned how to talk with clients a little more subtly about building that conversation up."

But Carter strongly believes that planning for medical expenses and end of life planning is not talked about enough.

"It's ignored, especially in the fiduciary RIA space because most of the solutions for long-term care costs and things like that have traditionally been more insurance-based," says Carter. " You've got to open yourself up and go to different conferences and listen to what some of these resources have out there for how you have these conversations."

To hear more of Brice Carter's insights about helping aging or terminally ill clients, you can listen to Beyond the Portfolio, episode e, "Medical Expert" here or wherever you listen to your favorite podcasts.

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Content provided is for educational purposes only and is not intended to be advice for any firm.