Trusted financial professionals can be among the first to spot a problem that's more than just normal forgetfulness. By Anne Kates Smith, Executive Editor From Kiplinger's Personal Finance, October 2014 Four years ago, employees in the legal department of Wells Fargo Advisors fielded an average of 30 reports a month from advisers in branch offices who were concerned about elderly clients. Today, reports about clients potentially being victimized by scams, suffering from dementia or simply laboring under a diminished capacity to make sound financial decisions stream in at an average rate of 100 per month. So Wells Fargo has assembled a dedicated unit called Elder Client Initiatives to investigate and handle such concerns, and even work with law enforcement or protective services, if warranted.See Also: Financial Planning for Alzheimer's Special Report Certified financial planner Dennis Stearns has likewise shaped his practice to deal with issues of diminished capacity among his older clients. "Twenty years ago, we had some of these issues. Now we see them every single week. We realized that there was a tsunami of messy situations coming our way and we'd better figure out how to surf that wave," says Stearns, president of Stearns Financial Group, in Greensboro, N.C. This year, 70% of the firm's monthly training sessions have been about how to deal effectively with aging clients. Other financial firms are ramping up similar efforts. Older adults have the most experience handling money and hold the lion's share of the nation's household wealth. But they're also subject to normal cognitive aging, which brings with it a decline in numeracy skills, processing speed, flexible decision-making and short-term memory, says Daniel Marson, a professor of neurology and director of the Alzheimer's Disease Center at the University of Alabama at Birmingham. "Warren Buffett is still an excellent investor and dealmaker, but he's not as good as he was at age 50," says Marson. He says people reach the height of financial decision-making prowess around age 53. Advertisement Seniors can fall prey to all sorts of predators, including a "senior adviser" whose designation might not be worth the business card it's printed on or a broker who's a crook. But trusted financial professionals can be among the first to spot a problem that's more than just a so-called senior moment or normal forgetfulness. "We have clients call to make the same withdrawal three days in a row, forgetting that they've called the day before," says Ron Long, head of Wells Fargo's Elder Client Initiatives. New guidelines for Merrill Lynch employees list red flags such as inconsistent decision-making (chucking a carefully constructed portfolio for investments unsuited to one's goals or risk tolerance, for example), no longer understanding where assets are invested or confusion about client-directed activity when it appears on an account statement. Red flags. Families on the alert for signs of diminished capacity shouldn't overreact if Mom or Dad occasionally forgets to pay a bill, says Marson. Forgetting to file taxes is a more serious memory lapse. If papers have always been carefully filed, bags full of bills and a messy desk should give you pause. Watch out for uncharacteristic checkbook errors or a struggle to figure the tip at a restaurant. Are you repeatedly explaining financial concepts to someone who was once conversant in mortgages, trusts and investments? And a biggie: Beware when a careful steward of assets takes a sudden interest in get-rich-quick schemes. More firms are asking clients—even young and healthy ones—to supply the name of a family member or friend who can be called upon if questions of capacity arise. (You should name a contact on your own if you're not asked to provide one.) Contacts don't need trading authority. But as you age, giving your adviser the ability to reach out to someone without running afoul of confidentiality rules can stop you from becoming your own worst enemy. Anne Kates Smith is a senior editor at Kiplinger's Personal Finance magazine.