When Death Plays a Role in a Financial Plan
One of the challenges in financial planning is the strong taboo in our society against talking about money. Another powerful taboo that affects advisors and our clients is talking about death when someone has a serious illness.
When someone is diagnosed with cancer, for example, the focus is almost always on treatment and recovery. Rarely is there any discussion of what happens if the treatment doesn’t work. There seems to be an unspoken belief that if we don’t talk about it, it won’t happen.
Not talking about death isn’t limited to family and friends, according to Dr. Carolyn McClanahan, who is both a physician and a financial planner. In a presentation in Phoenix on September 29, she pointed out that many doctors shy away from talking about dying until the very end.
Given this strong reluctance to talk about death, how do we as financial planners support clients with serious illness? Here are some suggestions based on Dr. McClanahan's talk.
- Don’t expect people facing a serious illness to give you an accurate prognosis of their disease, as they are often in denial. McClanahan suggests turning to "Dr. Google" for accurate information. Specifically, she recommends the National Institutes of Health, which has statistics on every disease imaginable.
- Learn to interpret the client's interpretation of what doctors say. For example, when a cancer patient is told chemotherapy has a 25% chance of working, the average patient hears "working" as "being cured." "Working" actually means there is a 25% chance of the tumor shrinking. Often the chances of being cured are far less than 25%, and the physical effects of chemotherapy can be devastating to one’s remaining quality of life. McClanahan says, "Most of what we do to people at the end of life is unnecessary torture."
- Find out about options for palliative care, and recommend clients start it early. Palliative care is multidisciplinary care focused on treating the symptoms of treatment, relieving suffering, and improving the quality of life. Because of denial and unwillingness to talk about what happens if they don’t get better, many patients never get into palliative care or get into it way too late. Similarly, most patients wait too long to get into hospice care. The average time in hospice care, according to McClanahan, is just 19 days.
- Address clients' concerns about money. McClanahan says that anxiety over having enough money to pay for their care and the resulting effect on the family finances are two of the top concerns patients have. Interestingly, most planners don’t list money in their top concerns. Instead, they focus on whether advance directives, estate documents, and funeral plans are in place.
- Be aware of signs that a person’s illness is advancing. These can include a shortened attention span, not remembering details of conversations, word-finding difficulties, inability to multitask, mental fuzziness, and depression. To deal with these symptoms, meet early in the day, address the most important issues first, keep meetings short, include family members in meetings as appropriate, and be sure someone is making a written list of action items.
- Overcome your own fears of clients' emotions. Serious illness affects people in many different ways, but the underlying concerns are always emotional. Be willing to hear and discuss those concerns. Work with clients and family members to create a comprehensive plan addressing both death and recovery. Reassure clients that, as McClanahan put it, "preparation for a negative outcome does not reduce the risk of cure."
As financial planners, we help clients prepare for the future, including the end of life. When that future becomes "now," clients need our support more than ever.
Rick Kahler, ChFC, is president of Kahler Financial Group, a fee-only financial planning firm. His work and research regarding the integration of financial planning and psychology has been featured or cited in scores of broadcast media, periodicals and books. He is a co-author of four books on financial planning and therapy. He is a faculty member at Golden Gate University and the former president of the Financial Therapy Association.