After my father died, my mother relied heavily on my brother and I when dealing with her financial affairs. She didn’t do anything unless she’d discussed it with us first and wanted one of us there when she met her financial adviser. However, she mentioned that she’s met with him recently without us and that, following his advice, she has moved her investments into a higher risk portfolio. I think the adviser should have consulted us. What do you think?
Phil Beck of Smith & Pinching responds:
This is a difficult question to answer: if your mother has the capacity to manage her own finances, then her adviser must base his recommendations on her wishes and needs, and he would not be able to discuss things with you unless she has given him authority to do so.
Having said that, as a profession we are committed to recognising when a client is in a vulnerable situation, and we have strict procedures in place to protect the client if they are judged to be at risk. Vulnerable situations can happen at any stage of life – whenever life puts undue strain on us that will have an impact on our decision processes – but vulnerability will perhaps occur more frequently as we grow older. Grief will certainly be a factor in a client’s possible vulnerability and may cause a reaction that seems contrary to the client’s normal behaviour.
The adviser should be alert to your mother’s risk profile and is unlikely to make a significant change in her investment portfolio without being sure that it is suitable for her long-term objectives. However, her risk profile may well have changed: it is possible, for example, that your mother modified her natural attitude to risk to align with her husband’s during his lifetime. She may actually be more comfortable with investment risk than you might have imagined.
I suggest you talk to your mother about her investment decisions and express your concerns. You could seek her permission to discuss her affairs with her adviser, then speak with him about what changes have been made and why. If you are unhappy with his advice, then his firm will have procedures for you to follow to raise your concerns.
However, unless your mother is showing signs of a lack of capacity or you believe she is being unduly influenced in some way, then she has the right to make whatever decisions she wishes.
Any opinions expressed in this article do not constitute advice. The value of an investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may get back less than you originally invested.
For more information, please visit www.smith-pinching.co.uk
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