Many Canadians are suffering from mental health issues and, as such, it’s affecting their ability to make strong financial decisions, according to a study conducted on behalf of Toronto-based Bridgehouse Asset Managers.
In fact, almost three-quarters (72%) of Canadian financial advisors surveyed say they’re meeting clients suffering from anxiety. Advisors also say that clients are struggling with diminished mental capacity (64%), depression (54%) and substance abuse (34%).
In all cases, advisors say mental health conditions negatively affect how clients handle their finances, the report says.
“The research shows that client mental health takes a bite out of sound financial decision-making and that advisors are seeking insight and practical tools to respond effectively,” says Bridgehouse president and COO Carol Lynde, in a statement.
“Several key recommendations emerged from it that we’re sharing with the industry that we can act on now,” she adds. “They cover educating advisors about recognizing warning signs, responsibilities related to privacy considerations/escalation, as well as strategies and skills training that adapt best practices from mental health experts.”
Most advisors are interested in receiving support from their firms in handling mental illness among clients. For example, 88% want a “transition kit” for helping clients with Alzheimer’s disease and dementia, in addition to continuing education surrounding mental health. More than 80% cited the need for a behaviour primer, community resources, seminars and other identified reports.
Based on this research, Bridgehouse believes the impact of mental health on client-advisory relationships calls for a policy-based response.
Advisors would benefit from support in the form of continuing education, skills training, tools and checklists. Firms can also obtain support through investor well-being round tables, case reviews and available experts.
Lastly, the industry can increase support by implementing legal safe harbour, incorporating mental health into investor policy and giving guidance on Trusted Contact Person/Power of Attorney, privacy and consent, and existing regulations.
On behalf of Bridgehouse, Toronto-based Navigator Ltd. conducted a national survey online between Dec. 18, 2017 and Feb. 13. The sample was collected via an open-link format: Bridgehouse sent advisors an email seeking their participation, and it was completed by 193.