Life transitions happen many times throughout a person’s life, but however prevalent they may be, they are still life-changing (or at least path-altering). And even though life transitions are numerous, we often believe they are less impactful than they actually are or that we have more time to prepare for them than we actually do.

For your clients, this type of occurrence often comes with mixed emotional and financial consequences. We’ve about how the average age of widows in the U.S. is 59, which is much sooner than most couples plan for, and how the consequences of not planning for this event early enough can have dire effects on a woman’s retirement.

There are Many Impactful Life Transitions

Beyond something as tragic as the death of a spouse, there are many life events that can trigger emotional responses and impending financial issues. Since these transitions can happen so often and throughout a client’s life, it is important to start the conversations early.

The looming question for many financial advisors is: ‘How do I talk to my clients about difficult topics that can seem far into the future?’

Life transitions include:

  • Marriage / divorce
  • Births / death
  • Change of career or job / starting a business
  • Illness
  • Caregiving situations
  • Etc.

It is easy to talk about these events when they’ve already happened or are happening soon, but it can be more difficult when they seem far off or implausible (i.e. your client is in peak health and has a healthy lifestyle).

Recognizing the Emotional Impact

Starting these conversations may feel uncomfortable but can be very rewarding.

It should be a given at this point, where it makes sense, it is critical that all key people involved in your client’s finances are present for these conversations, including spouses or adult children who will be immediately impacted by the events.

Once you have everyone in the room, Dr. Amy D’Aprix recommends starting with understanding the true emotional impact so you can express empathy in a natural and genuine way.

“Clients want to feel heard and understood beyond their money. Empathy builds genuine trust, and knowing more about your clients makes for more robust financial plans”

This is important for advisors on the business side, too, because 70-80 percent of surviving spouses leave their advisor because they have not created that personal connection with them that they need to feel safe and understood.

How to Lead with Empathy

As someone in the relationship business, you may already be convinced that leading with genuine empathy is important to the lifeblood of your business, but how do you do this in practice? The best place to begin is to understand the emotions that your client may be feeling.

These oftentimes complex and difficult emotions include, but are not limited to:

  • Excitement
  • Overwhelm
  • Guilt
  • Grief
  • Joy
  • Reconnection

As you can see, with any life transition, there will be a mix of emotions both positive and negative, but to use that information to guide their financial plan, you have to explore all of the options so you can provide a solution that best suits them moving forward.

Dr. Amy believes that an advisor can truly set themselves apart from the competition by engaging their clients in conversations as they are going through life transitions. “By checking in on their emotional well-being, acknowledging their emotions, and genuinely expressing empathy – the client understands you have their back”.

In our next article, we’ll explore the life transition of caregiving in more detail and how you can take the emotional understanding of a client’s situation and lead that into a discussion centered on logic and finances.