Ralph E. Rolfe
Ralph E. Rolfe
Elder care—yes or no?
Advising an aging clientele requires unique skills and knowledge.

December 20, 2012
by Ralph E. Rolfe, CPA/PFS

As financial planners, we often look for special niches or areas in which to work because it helps us focus our attention on certain types of clients and their particular vocation or demographic strata. Some of us will work with physicians while others will focus on teachers or athletes. I believe that focusing on such a niche allows us to be more knowledgeable and better able to provide quality services to our clients as we understand more about them.

However, as a 65-year-old planner, I am discovering that the needs and concerns of my aging client base are in many ways more challenging than when my clients were younger and their children were in college. I am finding that the knowledge base and skill set that I had as a younger planner working with younger clients is not adequate to deal with the unique and sometimes disturbing issues facing my older clients. It has been estimated that by the year 2030 there will be 70 million people age 65 and older in the United States—more than twice the population for that age group in 2000. Let’s consider for a moment some of the various issues that are unique to our aging population.

Income requirements

As we age, our time frame for recapturing any downturns in the stock markets becomes shorter, so planners must become more familiar with income planning than we have been in the past. This may mean using financial instruments that we have perhaps avoided in the past.

A host of alternative investments are flooding the marketplace. Are these acceptable investments for seniors or are they too aggressive? Does a reverse mortgage make sense? Budgeting is even more important at this stage of your client’s life than it was in his or her younger years. These are questions and issues to consider when sitting down with older clientele. One of the most significant emotional issues our clients face today is whether they will run out of money in retirement.

Another area with which we need to become familiar in order to serve our older clients is the intricacies of Social Security and Medicare. The PFP division of the AICPA in conjunction with the Eldercare Task Force and planners James Sullivan and Theodore Sarenski have put together two excellent guides to assist you in at least two of these areas: Sullivan’s Unlocking the Mystery of Healthcare Planning for Retirement and Sarenski’s The Adviser’s Guide to Social Security: Unlocking the Mystery of Retirement Planning.

Changes in mental capacities

We are all aware of the tragic stories of Alzheimer’s patients losing their capacity to make sound decisions, but as our population continues to age another mental issue begins to become more of a factor. That is people who are gradually dealing with vascular dementia, which can be caused by a series of small strokes over a period of time. As planners, we must be able to recognize when our clients are no longer able to make sound decisions or are losing their capacity to use good judgment.

It is vitally important that the eldercare planner understand some of the early warning signs of the possible onset of these mental changes. It may be necessary to encourage a client to bring someone with him or her to your meetings. Never share information regarding your client with anyone else without first obtaining written consent to do so or obtaining a copy of a recent power of attorney authorizing that person to act on behalf of your client. This is a very sensitive area and one that must be addressed very carefully. Caution here could help avoid potential litigation issues later.

Home alone

Many clients find themselves living alone while their family members often are hundreds or thousands of miles away. At times, many of our clients may need assistance in handling virtually all of their financial decisions or may require consultation on those decisions. Many will need assistance with understanding their medical explanation of benefits (EOB) forms, assistance with balancing their checkbooks, and some even may need assistance paying their bills. Each of these responsibilities needs to be approved by your compliance department if you are a registered representative, and you should also verify that your professional liability insurance will cover any services that you are looking to provide to your clients.


In light of the above factors, what should be our response to the aging of our client base? In my opinion we have both an opportunity to provide an important service to our clients as well as an ethical responsibility to be prepared to assist our clients with the areas noted above and other needs that might arise.

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Ralph E. Rolfe CPA/PFS, is the president of Covenant Financial Concepts, a member of the AICPA Elder Planning Task Force, and an Investment Advisor Representative. Securities and advisory services offered through Multi-Financial Securities Corp. (MFSC) member of FINRA and SIPC. Covenant Financial Concepts is an independent organization and is not affiliated with MFSC.

The AICPA PFP division provides elder care information and materials.