Generational Advisor

How to Build Trust Today

KNOW: We've been talking about rebuilding trust with clients for over a year now. But do you know how to do it? The new MDRT Generational Financial Confidence Study offers some important clues.

DO: You don't earn trust these days by being the best or most experienced, but by delivering honest, knowledgeable and straightforward advice to clients.

Use the Right Words

KNOW: Language matters when talking with clients of different generations. The MDRT Generational Financial Confidence Study reveals that older clients want to hear about their financial future and investments. Younger clients want to plan for retirement and get insight on how to make money.

DO: Customize the words you use with the different generations. Only those at retirement age are ready to talk about "financial plans." Most younger clients want to plan for their "retirement." And younger clients want help making money, not managing investments, the term preferred by older clients.

Know Thy Client

KNOW: The MDRT Generational Financial Confidence Study reports that the immediate term opportunity for new clients is with ages 30 to mid-50's, those Gen Xers and younger Boomers. Some 35 million are looking for help in all things financial.

DO: Invest time in getting to know your clients better. It is something they want to a higher degree than advisors are currently delivering.

It’s the Economy, Again, Stupid

KNOW: New MDRT research reveals that that consumers today have a "risk-averse" mindset about financial products and services; there is a "new normal" for financial thinking. DO: Advisors and agents need to understand how this thinking isn't being matched by behavior. In fact, you need to inform clients and prospects about products so their fiscally conservative thinking becomes fiscally responsible behavior.

New Research from MDRT & the Boomer Project

KNOW: New research from MDRT & the Boomer Project reports that almost 90 percent of clients of all ages are ready to talk about plans and planning. DO: Focus calls on the confidence issue. Ask clients and prospects, "do you have a plan?" Don't be discouraged if they tell you they already have one. Simply ask if they are confident in that plan. Many are not.

Here Come Reverse Mortgages

KNOW: The new Consumer Financial Protection Bureau has its sights set on reverse mortgages, but so do major players like Wells Fargo, Bank of America and Met Life, not to mention your Boomer clients. The game is on. DO: Make sure you know all there is to know about reverse mortgages because your Boomer clients will be interested. One place to start is with the Reverse Market Insight group's web site.

The Paychecks Stop

KNOW: Younger clients, those under 40, are most likely to worry that funding their retirement is up to them and them alone. No pension. Precious little from Social Security. Their worry becomes frustration with articles like this from The Washington Post, which tells them to save because "the paychecks stop." DO: Understand the mind-set of younger clients, who know it's up to them to save for the future, but also are trying to manage their current lifestyle with stagnant wages. Don't focus on "retirement," but instead aim for making money now for the future, when indeed, the paychecks stop.

Boomers and Xers at Risk

KNOW: Nearly half of all Boomers and Gen Xers are at risk of having insufficient financial resources to cover basic retirement expenses, finds a new Employee Benefits Research Institute report. Even high-income Boomers need to increase their savings to improve their odds. DO: Avoid propagating the idea that a certain dollar target for income and savings will ensure a comfortable and secure retirement. Too many unpredictable things can happen. Encourage clients to think in terms of probability -- as achieving in a 70% or 90% probability of having enough money to last their retirement.

Coming Soon: Longevity Tests

KNOW: A Boston University research team claims that it can predict with 77% accuracy if someone will live to be 100 or more, reports the Wall Street Journal, and it plans to make the genetic test available through the Internet. DO: "Longevity risk" is one of the biggest uncertainties in long-term financial planning. Urge wealthy clients to take the test. Whatever the results, you will have a reason to sit down with your client and create a long-term financial plan or, if they already have one, to update it.

Time for an Attitude Adjustment

KNOW: Mark Patterson, a financial advisor writing in US News & World-Report, offers five "attitude adjustments" needed for a successful retirement, starting with "Your retirement is more important than your kid's college education" and "Your retirement is worth more than your kid's lifestyle." DO: Agree or disagree with him, the issues Patterson raises are important topics for financial advisors to discuss with clients. Want a conversation breaker to get your client focused on long-term financial planning? These are a good place to start.