Sign up for the new Globe Advisor weekly newsletter for professional financial advisors on our newsletter sign-up page. Get exclusive investment industry news and insights, the week’s top headlines, and what you and your clients need to know.
If you’ve been feeling fatigued, frustrated and lethargic lately, there’s a very good chance many of your clients are feeling exactly the same way.
Classic signs of burnout – from headaches to feeling overwhelmed and the inability to focus – have become commonplace during the pandemic, particularly for health care workers, teachers, and anyone else forced to work long hours in challenging settings.
To get some relief from stress and overwork, some Canadians are looking to take time off – for months, a year, or indefinitely.
Even white-collar employees have been thinking about taking a break. A LifeWorks Research Group and Deloitte Canada survey found that more than half (51 per cent) of senior leaders report wanting to quit, retire, or move down to a less stressful or senior position.
People are looking for a career escape hatch, says Bruce Sellery, chief executive officer of Credit Canada Debt Solutions in Toronto. But their plans aren’t always based on making solid, logical financial decisions. They just want out – to heck with the consequences.
“They’ll do all the math and it will be horrendous, and they’ll still be like, ‘I’m totally quitting,’” he says.
Mr. Sellery points out that the decision to take an unofficial sabbatical is much like choosing to get married. “Marriage doesn’t live in the land of pros and cons and linear logic either.”
Owen Winkelmolen, a fee-for-service financial planner and founder of PlanEasy Inc. in London, Ont., adds that as going on a career hiatus is often an emotional decision, that means it’s more important than ever for advisors to give their clients sound advice.
“This is a huge financial decision. We’re talking tens of thousands of dollars or more in the scope of clients’ financial plans,” he says, explaining that when clients step away from, say, two years of work, they’re not only withdrawing for that time, but are also missing out on the income and the savings too.
“You really want to make sure you give all the facts needed to support the decision so they’re not digging themselves into a bit of a hole,” he adds.
In these situations, vital financial assessments that will not only give clients the break they so desperately need, but keep them from wiping out their savings and prevent their accounts from dipping into the red are important.
Encourage them to talk to their employers
Terri-lyn Lenz, financial advisor with Sun Life Financial Investment Services (Canada) Inc. in Saskatoon, says one of the first steps advisors should take is to encourage burnt-out clients to have a talk with their employer before quitting or leaving their careers entirely.
With unemployment rates at historical lows, companies and organizations want to retain good, albeit exhausted, workers now more than ever.
“Employers can be very understanding. I know people who have taken leaves of absence with or without pay, but their job is there for them when they go back,” she says.
Mr. Sellery notes that his husband recently took a leave from his job in theatre to hike the 750 km Camino de Santiago trail in Spain for 33 days.
“He came back saying, ‘That’s what I needed. I didn’t need to quit. I needed to take a break,’” Mr. Sellery says.
Come up with a mini life plan
Not all financial plans have to take a bird’s-eye view. When clients want to make big life decisions that will have a short-term impact, Ms. Lenz creates a mini life plan that looks at the next six months or year.
Each one is going to be different depending on the client. For example, a single father with two kids will need to decide if he should pause contributions to their registered education savings plans until he’s back at work or ask grandparents to help make monthly payments for a while.
Other considerations include if there are two incomes, the current debt level, and would the person be eligible for employment insurance or disability benefits. All of these factors have an impact on how long a person can conceivably be off work.
When doing a deep dive into cash flow for clients, it also pays to be as specific as possible, but also ask some big questions.
For example, what exactly is considered discretionary spending when there’s no income coming in? That depends on how long they’ll be off.
“Can you say retirement savings is discretionary for five years? No. For one year? Yeah,” Mr. Sellery says.
Another option is to look at other ways to take the financial pressure off for a while. Maybe clients can rent their cottage out for a couple of months, get a home equity line of credit, or remortgage their house. If they finished a big home renovation, they could be eligible for a big tax reimbursement. There are plenty of ways to find lost money if you look.
For some who are overworked, underappreciated, or just miserable on the job, it doesn’t matter how many carrots are dangled, they want to quit. If you know this move is on the horizon for some clients, be sure to remind them about some practical considerations like taking advantage of their benefits package.
“Teeth, now. Physio, now. Do you need therapy? Do it now … Shop the company store,” Mr. Sellery says.
Ultimately, when it comes to advising stressed-out clients, the practical money side is only part of the conversation. The rest relies on using soft skills to give them the power to figure out what their new future can look like, Ms. Lenz says.
“It’s about letting them know, ‘Yes, it’s your decision and there’s support – let me help you find that,’” she says.
For more from Globe Advisor, visit our homepage.