Article published in Elderly Client Adviser March/April 2010
As a solicitor specialising in Wills and Probate work I inevitably spend a large proportion of my time dealing with the elderly. As a firm our philosophy is to offer all our clients a rounded service in addition to focusing on the individual transaction or issues that the client may have consulted us about. It has become increasingly apparent that this is of prime importance when dealing with the elderly client market and our firm’s Wills Probate and Trusts department has spearheaded the development in our firm of applying this “holistic” approach.
For most elderly clients the first fact finding meeting is key to this strategy. This meeting is undertaken without charge to the client, something we have found to be of paramount importance in securing the client’s trust. This helps to ensure that the client feels relaxed and makes it easier for us to draw out relevant information from them. Many elderly clients feel far more comfortable if this initial meeting can be held in their own homes as they feel more confident in familiar surroundings, particularly if they don’t usually go out very often. We will establish early in the meeting whether the client has any difficulties that we need to be aware of such as poor sight or hearing as this may affect how we communicate with them. Empathy with the client is essential.
In addition to the obvious basic information that we would be asking any client for at an initial interview, when dealing with this client group we are looking in particular for detailed family background and history. We will also talk to the clients in detail about their financial circumstances and the way in which their assets are held. Does the client live with someone or alone? If alone are they widowed or divorced? If with someone else are they married or not? Have either of them been married previously? Are there any children of this relationship or from previous relationships? What are the circumstances of the children – do any of them have any particular problems whether financial, medical or personal?
Does the client have a Will? If so we will review this with them as a matter of course. Often either the client’s circumstances or those of their family members will have changed since they made their Will. Even if the provisions set out in the Will are appropriate, it is useful to put an up to date record of contact details, for executors and beneficiaries, with the Will.
When looking at Wills, protection of assets is an issue regarding which many clients will require advice. If there are potential beneficiaries who have capacity issues, financial problems, marital difficulties or who are in receipt of means tested benefits, the client will need to be advised regarding the use of discretionary or protective trusts. Where there are children from previous relationships, the separation of the assets of a couple, combined with the use of a flexible life interest trust or discretionary trust might be considered. Advice as to the appointment of appropriate trustees is paramount here and it is also important to ensure that the clients are advised on the potential pitfalls of such arrangements. The client must be advised of the importance of ensuring that any trustees appointed are trustworthy. The client also needs to think about how the management of the trust will actually work and particularly to think about whether this could be compromised by clashes between trustees or between trustees and beneficiaries. This is of course a major issue with the use of any trust which contains any discretionary powers for the trustees.
Does the client have an Enduring Power of Attorney, or Property and Affairs Lasting Power of Attorney (LPA) in place? If not then it is best practice to advise them to put one in place.
If the cost of putting in place an LPA is outside the client’s means, we will always look at whether what the client is trying to achieve can be accomplished by other means, such as a third party mandate on a bank current account used to pay bills or to pay nursing home fee contributions or appointeeship for the receipt of state benefits. If capacity is an issue we will work with the client’s medical practitioners or advise family on deputyship.
If the initial fact finding has been dealt with properly then it should be a straight forward matter to advise on Inheritance Tax matters such as the use of the transferable Nil Rate Band and annual gift allowances and to flag up circumstances where more detailed advice is required such as regarding the possible use of trusts or a referral to an IFA to advise on the use of investment strategy to minimise Inheritance Tax liabilities.
We are always happy to consider working with a client’s existing financial adviser where the client has one although we do as a matter of course check the financial adviser’s details carefully as we consider that it is in the client’s best interests. We also maintain our own panel of independent financial advisers whose qualifications and experience we have checked and to whom we may refer clients, with their permission, for appropriate advice. Many of the advisers on our panel are chartered financial planners and we have advisers who specialise in dealing with particular client groups with particular issues such as planning for future Care Home fees or Equity Release. We ensure that all the advisers on our panel will advise our clients on a fee paying rather than a commission basis.
When looking at clients’ income we will always look at what benefits they are receiving to ensure that they are claiming what they are entitled to receive and that any benefits such as attendance allowance are being paid at the correct rate. We will also advise clients to have their income tax position checked either by us or by their own accountant. Age allowances in particular are not always applied correctly by the Revenue and clients who are in receipt of modest occupational pensions in particular, may find that they can claim back income tax on savings income. This exercise is of course more likely to be worthwhile when interest rates are higher.
We maintain contact with a number of local accountancy firms to whom we can refer clients for an income tax health check at a very modest cost. We will also often refer clients to them when recently widowed to ensure that income tax allowances are correctly applied at this stage when mistakes made can result in income tax being over or under paid for years.
At the end of the initial fact finding appointment terms of business will of course be sent to the client for any work they want us to carry out, but in addition where we have recommended that the clients consider taking steps that they had not considered before consulting us, written advice and further information will be sent to them to give them the opportunity to digest this information and perhaps to discuss it with family members. The client is encouraged to come back for a further meeting if they feel that they would like a further explanation of anything we have discussed.
Training support staff in the department is crucial in achieving best practice. Even staff who take an initial enquiry regarding the cost of a Will will always offer our free initial fact finding appointment and encourage the potential client to take this up rather than choosing to instruct a practitioner on the basis of cost.
On the whole we have found that the holistic approach has been very popular with clients, leading not only to repeat business but also to the recommendation of our firm by clients to their family and friends. However, whilst the approach represents in my view best practice, one must of course always be aware of why the client has consulted us and what the client wants from us. It is all very well for us to tell the client what we believe is best for them but at the end of the day it is of course their prerogative to instruct us to do otherwise! This makes it particularly important to accurately and comprehensively record in writing all the information that we have received from our clients and the advice given at client meetings This written record can be a very useful tool later if there should be family disagreements as to why the client did or did not do something that it seems obvious later on it would have been sensible for them to do.
In these times of a rapidly changing legal market, what sets the solicitor who specialises in elderly client advice apart from their cheaper counterparts is their ability to look at all the client’s circumstances, to consider the wider picture and to offer appropriate advice. There will always be clients who will instruct a practitioner to prepare a single document on the basis of price alone and we will not be able to compete with those who solely offer drafting or processing services who have much more limited overheads than our own. The playing field is not a level one and our only hope of future success is in my view to offer a service which is bespoke and tailored to the clients’ needs. This of course means that we must continue to develop the skill of finding out what our clients’ needs are and addressing them appropriately to the satisfaction of our clients.