The nation's systemic financial crisis has dominated the headlines since last September. But as excruciating as it has been, the economic and market meltdown is not the only financial crisis many Americans must contend with.

Whether because of job loss, divorce, long-term illness or the death of a spouse, your clients regularly deal with crises that throw their personal lives into a tailspin and, potentially, their finances into disarray.

Financial decision-making is hard in the best of times. But life crises come with an additional layer of cognitive and emotional complications-and, frequently, with a requirement to act promptly. These are the "perfect storms" of personal finance, when the need to make urgent and consequential financial decisions meets an emotional hurricane. As a result, many families take ill-considered actions or, worse yet, do nothing, potentially placing their financial security at risk.

Bear markets and economic downturns will eventually pass, but life crises, like Ben Franklin's proverbial death and taxes, are almost always certain. The good news is that you can help clients anticipate and address a financial life crisis. Therein lies an opportunity-and an obligation-for advisors.

CAN YOUR CLIENTS COUNT ON YOU?

To better understand financial decision-making during a life crisis, AARP Financial commissioned a survey. The results revealed a significant problem.

More than half (57%) of the 1,200 adults surveyed had already experienced a life crisis such as divorce, death of a spouse, job loss, serious illness or disability in their household. In most cases, the event had a significant impact on family finances. During these life crises, most respondents sought financial advice from families and friends-who are well- intentioned, but not necessarily financially well-informed. They did not call on advisors like you. Asked where they turned for help with the financial implications of specific life crises, professional advisors or financial services company representatives were cited, on average, only about 15% of the time.

The really good news is that those who sought professional financial advice in times of crisis felt very well served, with 66% reporting they had a "very positive experience" and another 24% citing a "somewhat positive experience."

A FAILURE TO COMMUNICATE

These statistics imply that despite its best intentions, the financial services industry has failed to communicate its care and concern. That old saw rings true: No one cares how much you know until they know how much you care. Financial expertise is not enough. We need to bring to bear our understanding and emotional intelligence as well.

What can you do? Engage every client in a comprehensive planning discussion that anticipates critical life scenarios. Help clients recognize the financial implications of such events. Do what you can to better prepare clients for the possibility of a life crisis: Stress the importance of an emergency fund and provide them with "just-in-case" plans and checklists. Also, look cross-generationally: What can your clients do to better secure their parents' finances?

Few families will avoid a life crisis. In my experience, most advisors intuitively understand the critical intersection of life crises and financial planning. The challenge is signaling to our clients our willingness to engage on these issues and identifying additional resources- including a network of attorneys, counselors, eldercare specialists and social service agencies-to bring into the conversation.

This, too, is certain: At least one of your clients is probably dealing with the financial implications of a life crisis right now. These catastrophic events are not just the proverbial elephant in the room; they're a herd. Advisors ignore them at their own risk-and to their clients' detriment.FP

Richard "Mac" Hisey is president of AARP Financial Inc., a taxable subsidiary of AARP. For more information on AFI's life crisis research, visit www.aarpfinancial.com/lifecrisis.