Making Your Practice a Magnet for Seniors

In Nancy’s experience, provided that they don’t run into health issues, retirees in the slow-go phase still want to travel but are less venturesome. For those clients she hosts entirely different travel presentations put on by a travel firm in her city that specializes in cruises and packaged tours for seniors.

The slow-go phase is when clients often look at downsizing. Nancy has developed relationships with a couple of real estate agents who specialize in condos that appeal to an older clientele. And where clients need help in the downsizing process, she refers them to a woman who has set up a small business specifically focused on assisting seniors who are downsizing and need help de-cluttering their homes.

No-go is the last phase and there was universal agreement among the advisors around the table that this is the most challenging phase. This is where failing physical health and dementia enter into the equation and adult children come into the picture, sometimes with their own agendas. This is also the stage where clients can no longer live independently; in those cases, Nancy has identified a woman who has particular expertise in working with seniors and their families to select the right assisted-care alternative for their needs.

Tap the top financial concern

Peter was another advisor at the lunch with a big focus on seniors. He talked about the one thing from which he gets the biggest response among his older clients: a simple 12-month cash-flow forecast. “I’ve found that most of my retired clients don’t have much interest in talking about retirement income plans and withdrawal rates. They want to be confident that they won’t run out of money – and the way they measure that is by going through the forecast of cash in and out that I prepare for each client for the year ahead. We do this in September and October, before they head south,” he said. (Because the lunch was in a city in the northeast, everyone around the table had the majority of their older clients escape south for at least part of the winter.)

Peter’s comment was echoed by several other advisors in the group. Given interest rates, many advisors talked about the challenges of generating the cash that aging clients need to sustain their lifestyles without taking more risk than clients can tolerate. Another widespread comment was the fixation among many of their older clients on avoiding a drop in the value of their investments. Martin was another advisor at the lunch who joked about this: “If clients get a statement that shows them up by $5,000 from last month, I don’t hear a word. But if they’re down by $50, my phone rings off the hook.”

There was considerable conversation about the different investment vehicles that can be used to generate a steady cash flow. Martin made a comment to the group on annuities that had others nodding in agreement: “I’ve read all the research on how annuities can help stabilize a retirement income portfolio but have had limited success getting clients to buy in,” he said. “Even with the clauses that offer a minimum payout, should clients die prematurely, there’s something about giving up access to a big chunk of their money that many of my older clients balk at.”

Speak the right language

Donald was another advisor at the table who raised a different hot button topic: “I’ve been surprised about how much my older clients hate paying taxes. Don’t get me wrong, none of my clients like paying taxes – but for some of my older clients this verges on a fixation. As a result, I spend a fair amount of time pointing out how we’ve structured things to pay the least possible amount of tax. Even if we’ve only saved $200, clients seem to walk away happy – it’s not the absolute amount but rather the principle at stake.”

Donald also talked about how he’d changed his approach after hearing a talk by Heidi Grant Halvorson, Associate Director for the Motivation Science Center at the Columbia Graduate School of Business.  In her book, Focus: Use Different Ways of Seeing the World for Success and Influence, Halvorson Grant outlined research that identified two types of personalities: those who are motivated by achieving gains and those motivated by avoiding losses.

Halvorson Grant’s research showed that aligning the right message to the personality of your audience dramatically improves results. Since seniors are overwhelming motivated by avoiding losses, Donald frames all of his recommendations in terms of avoiding negative outcomes. As one example, when Donald suggests that clients invite their children to sit in on meetings, he describes the negative outcomes that he’s seen take place in situations where kids have been kept in the dark, something that could be avoided if they were involved. Since he began focusing on avoiding negative outcomes, has seen a perceptible improvement in getting buy-in to his recommendations from older clients.

You can read more on the research that Donald described in The Question that Gets Prospects to Act. 

Respecting independence

Donald’s comments sparked a conversation on two other hot buttons for seniors.

One is leaving a legacy – in some cases for their children and especially their grandchildren, and in other instances for good causes that the clients support. There were a number of comments from the advisors in the room about the growing desire by aging clients to get recognition for contributions while they are still alive – and a couple of advisors had seen success with insurance-driven solutions that can provide a significant sum to a charity and at the same time lower a client’s tax bill, tapping into a couple of motivators. 

The other big hot button for clients relates to independence. A number of advisors talked about how aging clients can feel threatened by suggesting that their adult children get more involved. No one had a really good answer for this – except to suggest that the earlier this issue was raised with clients the better. It’s a lot easier to introduce the notion of getting children actively involved when clients are still vital than when they are feeling vulnerable and threatened.

The right staff

Something else on which there was agreement was that when dealing with aging clients you have to be prepared for long meetings.  One typical comment: “For some clients, I’ve learned to book off an entire morning. You have to let clients go at their own pace and never want to have them feel rushed. One client recently told me that I’m the only person who listens to her without looking at my watch.”

And as clients get older and mobility becomes more limited, meetings can be a challenge. A number of advisors talked about needing to be prepared to meet at clients’ homes. Another talked about having success with Skype meetings, in which one of his junior staff drove to clients’ homes to set up skype for their meeting … and then in some cases stayed on afterwards to help the clients Skype with their grandkids.  

Several of the advisors at the lunch also talked about the critical importance of the right staff. One said: “You have to be incredibly patient when dealing with some older clients. I’ve learned the hard way that some of my support staff just don’t have the patience. That’s especially true of some of the younger kids – my best support person is in her 50s and has a natural warmth and interest that my older clients love.”

Getting the word out

We finished by talking about how, once you build the capability to deal with aging clients, you can get the word out. A number of advisors described their strategies:

• Nancy is the advisor who runs client events around travel destinations and has had good success getting clients to invite friends. After people have attended two or three times, it becomes easier to ask whether they’d like to sit down to discuss their situation. The key to a good turnout:  Do these events during the day when it’s light out, ensure there’s lots of free parking, and have food.

• Martin runs an annual morning in September for his snowbird clients who spend part of the winter down south. One of his biggest draws is someone from the local police force to talk about how people can secure their homes … and like Nancy he encourages clients to invite guests.

• Kathy has a significant number of clients who winter on the Pacific Coast of Florida. She travels to Florida to meet with clients twice over the winter, each time adding a few days of holiday herself … and said that she has yet to return without picking up at least one new client who hears about the fact that she is going to be in the area to meet someone they know. Like Nancy and Martin, Kathy tells the clients she’s meeting with that should they have friends with questions, she’d be happy to talk to them.

My final question at the lunch was a simple one: Knowing what they know now, would the advisors have chosen to focus on seniors as their core constituency?

The answer was a universal yes – and not just for the financial benefits. There was agreement that the right advisor can make a huge difference in not just the financial wellbeing but also the peace of mind of older clients – and that the feedback from older clients and their children is one of the biggest payoffs in the business.

Dan Richards conducts programs to help advisors gain and retain clients and is an award winning faculty member in the MBA program at the University of Toronto. To see more of his written commentaries, go to www.danrichards.com or here for his videos.

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