3 simple ways all advisers can adjust their practice to help vulnerable clients

As an adviser, you may consider it your duty to keep pace with “gaps” that form in the advice industry. The gender wealth gap, for example, is a widely discussed topic that could help you provide bespoke services to female clients.

One less discussed gap that has become apparent since the Covid-19 pandemic is the “vulnerability gap”.

Professional Adviser reports that a survey of 100 advisers estimated 18% of their clients could be considered vulnerable – the equivalent of 11.7 million people. In reality, the Financial Conduct Authority (FCA) estimates the figure has reached 28 million, up from less than 4 million before the pandemic.

What’s more, the report claims only half of advisers carried out formal work to identify potentially vulnerable clients in the six months to July 2022. Plus, 60% of advisers recognised only half of vulnerability factors – meaning adviser knowledge of the spectrum of vulnerability is limited to say the least.

All this to say, it’s clear not all advisers can recognise vulnerability in clients, and may not have the knowledge to adapt their services accordingly. If you wish to boost your skills in this area, you’re in the right place.

Read on to find out three simple ways you can adjust your practice to help clients in vulnerable circumstances.

1. Educate yourself on the risks those in vulnerable circumstances may face

All your clients are vulnerable to basic financial risks. If they invest a significant portion of their wealth in the stock market, for example, it’s never guaranteed they will see the returns they want.

Yet individuals in vulnerable circumstances could be at even greater risk of losing wealth due to crime, abuse, or uninformed decision-making.

According to the FCA, those considered financially vulnerable could be experiencing:

  • Ill health or disability, making it difficult for an individual to access a service
  • Low resilience towards financial stress, for example due to mental illness
  • An emotional or financial shock, such as a divorce or death, having an impact on their lives.

Anyone in these circumstances may be more intensely exposed to certain financial risks, including:

  • Financial abuse. Sadly, Aviva reports 2 in 5 Brits claim to have suffered economic or financial abuse, with 39% naming their spouse as the perpetrator, and 61% saying the cost of living crisis has worsened their situation.
  • Becoming the victim of a scam. The UK Finance Annual Fraud Report 2022 found £1.3 billion was stolen by financial criminals in 2021 alone.
  • Living without protection. Canada Life has found 78% of UK of adults don’t have a Lasting Power of Attorney (LPA) – and for those living with illness, disability, or even simply old age, a lack of protection could have a devastating impact.
  • Making uninformed or unsafe financial decisions. While anyone can make an uninformed financial choice in this day and age, vulnerable individuals might be more at risk. With no access to professional advice, those in vulnerable circumstances could be tempted to make drastic financial changes without having the right information at their fingertips.

As an adviser, educating yourself on the risk factors that could affect people in vulnerable circumstances is the first step towards closing the vulnerability gap.

Having a foundational knowledge of the issues these individuals may be facing in this day and age may allow you to recognise the signs of vulnerability in a client, know which areas to cover when you meet them, and adjust your practice to meet their needs more accurately.

2. Get to know your clients on a personal level

When we talk about “goals-first” financial planning, vulnerability factors play a huge part in this process.

As an independent adviser, it’s likely you take the time to get to know your clients’ dreams and goals before you start discussing their finances. For those in vulnerable circumstances, this level of personal attention is even more crucial.

For instance, if you meet a client for the first time and find out they are a full-time wheelchair user, listening to how this experience will affect their life plans is essential. They might have ambitions to renovate their home to better meet their needs, or wish to pay for private medical care, to name just two examples.

Taking the time to understand your client’s needs, especially if they are living with vulnerabilities that could affect their financial plan, can help you adjust your approach and provide a better service in the long term.

3. Work to make your services more accessible

During the Covid-19 pandemic, remote meetings kept our industry moving. We all became accustomed to meeting clients on a screen – but now, you may have moved back into in-person consultations, especially if you like to get to know your clients personally.

For those living in vulnerable circumstances, however, remote meetings could feel like a godsend.

While you may prefer to have a face-to-face dialogue, meeting clients where they are and keeping up remote meetings could help those living with:

  • Long-term physical illness
  • Disability
  • Mental illness
  • Care responsibilities
  • Lack of transport.

One of the traits of a successful adviser in today’s world is versatility. Even if you’re a traditionalist, continuing to offer remote meetings can prove you put your clients’ needs above your own preferences.

In addition to operating both remotely and in-office to cover all bases, it could be wise to welcome feedback from all your clients about the accessibility of your firm.

Client surveys can be a great way to get honest, anonymous feedback from clients who may not wish to speak with you directly about their needs.

What’s more, working with a network of advisers around improving the accessibility of your service could give you the peace of mind that you’re doing all you can in this area. Here at Corbel Partners, we provide training, webinars, and one-to-ones with our company directors, so you can better all areas of your practice year-on-year.

Get in touch

To join a network of advisers that can help improve your soft skills, adapt your practice to the modern world’s challenges, and help vulnerable individuals, get in touch. Email hello@corbelpartners.co.uk or call 01925 637891.

Please note

This blog is for general information only and does not constitute advice.

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