Addiction and Financial Management

An advisor’s care for your well-being should go beyond money

As a wealth manager, I have found that helping a family protect their assets can go far beyond finding suitable investments and deploying tax-saving strategies.

Sometimes, it involves helping a client who has fallen into an addiction that hurts their well-being both financially and physically.

Because my colleagues and I become so close to the families we serve, we often feel a moral obligation to help them deal with difficult situations. And that can be a tricky thing to do. Recognizing a potential problem is one thing; finding a compassionate way to intervene is another.

I once served a client, before I joined Aspiriant, whose parents and grandparents created most of the family’s wealth. I was hired to solely advise on the investments while a trust company served as administrative trustee for such things as preparing trust tax returns and approving discretionary distributions.

Early on, I could tell something wasn’t right. The client would sometimes cancel meetings at the last minute, even though my colleague and I had traveled hundreds of miles to see her. She would sign agreements and then later leave rambling phone messages complaining about them or having no memory of them at all. And she started spending lots of money on private security and other unnecessary things. A bigger problem seemed to be at hand.

“With the ongoing opioid epidemic and readily available marijuana, alcohol and other drugs, addiction has become a problem with no class distinction.” — Dr. Louise Stanger.

Eventually, her children put her into residential treatment for substance abuse. When they looked at the trust transaction history, they were shocked by how much she had spent from the main family trust — more than $1 million a year. Because the firm I worked for didn’t have control of the trust accounts, I was not in the position to help as much as I wished I could have.

Here at Aspiriant, it’s different. We build an incredible bond with clients — some have even shared sensitive information with me that they haven’t spoken about with family members or close friends. And because we offer a full suite of financial services, we’re in the unique position to both protect assets and assist clients in finding the professional help they might need.

Recognize the signs

It’s important to realize that substance abuse and other behavioral health disorders, such as shopping addiction or gambling, can afflict all types of people no matter their age, gender, nationality or economic status, explains Dr. Louise Stanger, a clinician, author and director of All About Interventions.

“With the ongoing opioid epidemic and readily available marijuana, alcohol and other drugs, addiction has become a problem with no class distinction,” she says.

Nobody wants to think that they or their loved ones will develop a dangerous addiction. But very often these afflictions develop after a life trauma one also doesn’t want to think about, let alone plan for, such as a major surgery or illness, job loss, divorce or death in the family. These events can cause pain and depression that lead people to abuse substances or engage in financially risky behaviors as they pursue a reward or relief.

To minimize damage to the person and family, it’s important to recognize the symptoms of substance abuse and mental health problems early. Dr. Stanger says to look out for:

• Sudden changes in spending habits
• Lying
• Increased irritability
• Rapid speech patterns
• Depression or being overly anxious or worried
• Legal problems
• Health issues or lethargy
• Relationship failures
• Work problems
• School issues
• Medical issues (e.g. chronic pain; shoulder, knee, hip replacement)
• Sports injuries (e.g. concussions)
• Unexplained accidents
• Family history of substance abuse, mental health issues, sudden death, divorce, etc.

Also, be aware of other signs of temporary incapacitation such as multiple falls or accidents, missing money, missed appointments, or falling asleep or being distracted during conversations. These symptoms not only indicate addiction, they could also point toward dementia or other health-related issues that would need to be treated.

If you see these behaviors in a family member, or yourself, you should feel comfortable reaching out to your financial advisor.

How your financial advisor can help

Your financial advisor could be that third-party observer who helps you to see the situation clearly. This professional should also be someone you can lean on to assist you through it. But don’t wait until a crisis happens. Like all financial planning, set up arrangements for what-if scenarios, including addiction, ahead of time.

Here are some ways you and your financial advisor can work together:

• Hold assets in trusts — First of all, consider trusts for children and your excess capital. Keeping your money in a trust offers automatic protections. Boilerplate trust documents include “spendthrift” provisions that allow trustees to adjust or control spending during a mental health crisis.
• Enable your advisor to intervene — You may want to consider additional language in trust documents and agreements with your advisory firm, such as a power of attorney, that allows the firm to speak up if they see something odd and help other family members take control in the event of a health crisis. Also, some states allow for additional financial controls with estate plans or trusts. Florida, for example, is one of the few states where if someone is incapacitated due to substance abuse and mental health disorders, a conservatorship via the Marchman Act may be initiated. It is best to seek legal counsel with someone who is knowledgeable about individual state rules regarding temporary incapacity or conservatorships.
• Arrange for treatment — An advisor may also be able to help research treatment facilities, make sure contracts are reviewed by a lawyer, and financially arrange for admission. Let your advisor handle the financial details of the treatment.
• Find other resources — Your advisor should be able to recommend suitable legal help and insurance policies to further protect your assets and financial responsibilities.

Coping with a family crisis is difficult for everyone. At Aspiriant, looking out for your family’s well-being goes far beyond account balances. We take a holistic approach to wealth management, which means being there for you through all of life’s ups and downs.

Dr. Louise Stanger — a clinician, interventionist, speaker, author and director of All About Interventions — uses an invitational intervention approach with complicated mental health, substance abuse, chronic pain and process addiction clients. She is widely published in various magazines and journals, and is the author of “Falling Up: A Memoir of Renewal” and “Learn to Thrive: An Intervention Handbook.”