Financial advisers work with many vulnerable clients across all age groups, with the ties they build with clients one of the highlights for many working in the profession.

    The vast majority of advisers and planners (some 98%) want to work with vulnerable clients, according to research from Just Group, conducted in 2020, but there are some challenges to doing so. 

    It can be difficult to judge when a client becomes vulnerable as changes may go unnoticed unless flagged by the client themselves.  

    As such, even for advisers who have regular and consistent contact with clients, it can be hard to spot the moment the balance tips from independence to vulnerability. 

    The Financial Conduct Authority (FCA) has its own definition of what constitutes a vulnerable client. It says, “someone who, due to their personal circumstances, is especially susceptible to detriment, particularly when a firm is not acting with appropriate levels of care.” 

    More often than not, life events or medical and circumstantial changes will define the point when a client becomes vulnerable, especially if they suddenly face acute or chronic issues. 

    Issues are not just about physical health of course. An acute issue may be a client going through redundancy, being recently bereaved, or going through a divorce. 

    More ‘chronic’ circumstances are when a client suffers a long-term physical or mental health condition or even something such as providing long-term care for a loved one. 

    The defining characteristic of a vulnerable client is difficulty in representing their own interests, making them more susceptible to influence from others.  

    Advisers will naturally want to help all their clients, regardless of their circumstances and will have different processes to help them do so. However, there are some common themes which most advisers will want to focus on. Below, we outline some of these key areas. 

    1. Educate your team

    Knowing how to spot the signs of vulnerability should be part of all staff’s training and development. It is vital that staff are as equipped as possible to support all clients and are ready to spot any signs that a client is vulnerable.  

    This is better accomplished if everyone is clear about what those signs are. There’s a wide range of resources available online to help with this, but good places to start include https://www.dementiafriends.org.uk/ or SOLLA training. 

    1. Tailored approach

    Rather than going for a standardised approach, each vulnerable client needs careful evaluation of their specific needs. Where a non-vulnerable client might need to be fully invested, a vulnerable client might need more cash on hand for an emergency, for example.  

    Getting the help of family members, setting up power of attorneys, and backing away from a digital-first approach, are just some of the many considerations that need to be taken into account.  

    1. Find a comfortable communication medium

    Most of us with desk jobs in the past year have had a baptism of fire when it comes to video calling, and these new technological communication methods are great – but they are not for everyone.  

    Older, less internet-savvy clients can find fiddly devices, apps or calling methods frustrating and stressful. A phone call, or even a well-written letter, can sometimes be optimal. That being said, some older people have embraced the world of Zoom wholeheartedly, so just ask! 

    1. Ditch the jargon

    It’s easy to fall into the language of investing and products, but many clients - vulnerable ones especially - are unlikely to know the jargon. Simple, clear explanations of products, services and rules will keep them feeling more confident of their situation.  

    1. Help with little things

    Your job may be to help with bigger picture issues in clients’ lives, such as how to best manage their wealth, but helping with the little things will bring them a surprising amount of relief. Looking at potential benefits they could be entitled to, whether they need help in the house with cleaning or even fixing something, can help make a huge difference to their wellbeing.  

    Helping clients link up with charities such as Age UK, which provide these services, can be an invaluable way to help them overcome small issues that could otherwise hold them back from bigger life decisions they need to make.  

    Start the discussion

    Add a comment