When you’re serving senior clients, there are a number of considerations you must take into account.

For one thing, a senior client is usually a matter of years away from retirement, if they’re not already retired. Their financial goals are therefore very different from a client in her 30s or 40s. A retiree is likely more concerned with maintaining wealth and their standard of living, as opposed to actively building wealth.

For another, they have certain potential scenarios they need to prepare for. Increasing healthcare costs is one; the need for long-term care is another.

But perhaps one of the most sensitive issues you face with seniors is the possibility of a decline in mental capacity as they age.

Of course, this doesn’t happen with every senior - many retain their decision-making capabilities and memory well into old age. However, if you find yourself dealing with a client who is suffering from Alzheimer’s or dementia, there may be a need to get in touch with your client’s family members.

Here are a couple of pointers on navigating these delicate relationships.

Consider creating a protocol with your client that will be implemented in case of diminished mental capacity.

As with all financial decisions, planning is key to success. It’s a good idea to talk with your senior clients about putting together a plan to be implemented in case of dementia or diminished mental capacity.

This should include items such as what exactly constitutes “diminished mental capacity,” as well as what signs or symptoms will signal that the protocol should be enacted.

Power of attorney documents should be prepared and signed, and incorporated with the rest of the protocol.

For your own protection, it’s important to consult an attorney and learn about your risks and liabilities in working with clients with dementia. A client who has trouble remembering things may not remember everything that occurs in their meetings with you, so it’s important to document each and every session. If possible, include a family member in those meetings so that you have another set of ears present.

Be frank and honest, but also compassionate, when dealing with seniors and their family members.

Whether a client is going through an illness like Alzheimer’s, or experiencing simple cognitive decline as a result of aging, that client’s family members are likely going through a very difficult period.

Keeping up with doctor’s visits and medications, visiting their loved one at home or at a nursing home - these things are emotionally taxing, and adding in finances on top of everything else can be highly stressful.

As an advisor, you have a great deal of power to help these families during their time of need. By maintaining honest, open, and compassionate communication between you and your client’s family, you will be more able to foresee potential problems before they arise and become crises. You’ll then be prepared to offer realistic options that can help your client.

If a family is having difficulties paying for long-term care, for example, a life settlement may be a good solution. Assuming your client’s life insurance policy qualifies, your client - or the person with power of attorney, if needed - could sell the policy through you and a life settlement broker for many times more than the cash surrender value.

Financial advisors can be exceptional resources clients and families dealing with diminished mental capacity, dementia, or debilitating diseases. For more on how to best assist your senior clients, read our post “How to Help Your Senior Clients Make This Year Their Best One Yet.”