When 60% of your clientele is retired, you don’t have a standard financial planning practice. Instead of helping clients build their assets, Jean-Luc Bourdon spends a good deal of his time trying to come up with the most tax-efficient withdrawal strategies.

“I’ve had to train my clients that it’s not a matter of whether you [always] withdraw from taxable accounts or tax-deferred accounts,” he says. “The right answer is the one that results in the most money in your pocket.”

By looking at the tax properties of each asset, the CPA-turned-planner can sometimes offset a bit of the income his clients recognize from required minimum distributions, for instance, with capital losses generated in taxable accounts. Meanwhile, instead of pulling more fully taxable money out of retirement accounts to supplement RMDs, he may suggest selling low-gain (or already taxed) assets. 

Reducing a client’s tax rate, particularly in the early years of retirement, can keep more of the client’s money invested and building compound investment returns, Bourdon explains. At a point where your economic health hinges on what you’ve got — rather than what you can earn and accumulate — every dollar counts.

Bourdon says his two-year-old firm, Brightpath Wealth Planning, concentrates on older clients largely because of geography. The Camarillo, Calif., firm is in a bucolic beachside community just south of Santa Barbara, where many people move to retire. More than 60% of his practice is made up of people older than 65, and a substantial number are in their 80s.

COACHING STYLE

Older clients also respond well to Bourdon’s style, which is more like coaching than planning. He encourages clients to talk about their lives, goals, families — the things that make them happy and fulfilled or frightened and uncomfortable. He then asks how he can help.

“Someone once asked me whether it was hard to explain the value of what I do. I laughed,” he says. “It’s not like I have an agenda or a product to sell. People come to me and tell me what they want. We try to help them get it.”

Sometimes, Bourdon says, the best thing he can do for clients is listen. The options that might have been available earlier in their lives are often gone. Their economic choices are dictated by things they did years before they met Bourdon.

“Sometimes life makes choices for you,” he says. “What is the point of talking about all of the options someone [else] might have in this situation? ... There’s an element of coming to clarity about where you are and what you can control.”

To be sure, his clients are not poor. To hire Brightpath, clients usually need to have at least $750,000 in investable assets. In two years, the firm has built up AUM of almost $70 million, partly because many of Bourdon’s clients at his previous firm followed him to Brightpath.

Still, if illness or disability demands spending that clients feel they can ill afford, Bourdon sees his role as helping the clients get the best answers in a realm of limited choices. He thinks clients gain this clarity when they’re given license to talk — without agenda or interruption. Bourdon even waits to jot down notes until after the client leaves, thinking that even note-taking can interfere with the candor of the conversation.

In initial meetings, Bourdon simply wants to hear about the clients: their life stories; things they hold dear; and how they hope he can help them. His role, he says, is to ask open-ended questions. And the resulting answers sometimes surprise even the clients, he says. 

One woman in her 60s, for example, came in nervously asking about investments. Bourdon told her he’d happily discuss investing, but first asked if anything they could do that day would give her peace of mind. After a short pause, she said it would be to get her longtime boyfriend, with whom she lived, to put her name on the title to their house.

What was really making her uncomfortable, she explained, was the fear that if her partner died first she could be thrown out of the home by his heirs. “Our agenda changed,” Bourdon says.
In another instance, a wealthy couple came in to talk about their just-completed financial plan. Sensing something was amiss, Bourdon asked the wife: “What’s missing? What would make you happiest?” A dog, she said.

“The husband looked at me puzzled,” Bourdon continues. “He had just given her a car and had no idea. Inviting that sort of reflection is where we find the real discovery.”

ELDER ISSUES

Of course, Bourdon does more than just talk. Brightpath does all the high-touch planning that you’d expect from a boutique wealth management firm — from investment management and tax planning to reviewing real estate contracts and estate planning documents.

And because he has so many elderly clients, he handles a host of often uncomfortable issues — from dementia to issues of elder abuse, and the wrenching emotional and economic impact of losing a spouse or moving into a care facility.

His experiences have convinced him that planners can help elderly clients in holistic ways that reach beyond simple planning — and may sometimes involve stepping into the role of an advocate.

When is that necessary? There are few bright lines. Bourdon says he’s had to urge clients to “resign” as trustees when they were losing cognitive skills, explaining that the process of moving to a successor trustee is far simpler when the original trustee is able to pass the baton, rather than waiting until the baton is taken away due to dementia.

He’s had to negotiate with banks to get them to send notaries to nursing homes and hospitals so that his clients could sign the necessary forms for a designated friend or relative to help pay their bills. He’s also had to head off attempts at elder abuse.

Bourdon says he was alerted to one such instance by a call from the firm’s custodian, asking about a trade that was initiated by a client who rarely traded. The trade was placed online, but Bourdon knew the client was suffering from memory loss and didn’t own a computer. He quickly called the client, who explained that he was getting “financial help” from a new acquaintance.

Bourdon urged the client to come into his office, but when he said he couldn’t make the next morning’s meeting because his new friend was taking him to the bank, the planner knew more steps were necessary.

Bourdon called the bank, urging them to be on the alert for an elderly man and an overbearing younger woman. The bankers intercepted them before any money was lost. The authorities were notified and Bourdon persuaded the man’s family to get more involved to prevent a similar situation from happening again.

Addressing many of these issues is more art than science, he adds. There are obviously financial elements to each issue, but few one-size-fits-all solutions. 

“I want to see how the clients view the situation and what they believe their options are. We’ll then engage in a brainstorming process to come to a conclusion,” he says. “We don’t tell them what they should do. We try to show them the future so that they can make a choice.”

Does Bourdon worry that there’s little future with such an elderly clientele? Hardly. “People develop the issues we deal with all the time,” he says. “We are not trying to build a multibillion-dollar firm, but there’s a wide pipeline of people who need our services.”

Kathy Kristof, a Financial Planning contributing writer in Los Angeles, contributes to Kiplinger’s and CBS MoneyWatch. Follow her on Twitter at @KathyKristof.

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