Business Transformation | 05.03.23
Connecting With Your Next Generation Retiree Clients About Long-Term Care Solutions
by: Takeaways from the BISA convention session presented by Joe Coughlin
Joe Coughlin kicked off the final session at the BISA Annual Convention, moderated by Caryl Falvey, with insight into client expectations when it comes to planning their future. It’s no secret that longevity planning comes with challenges, but according to Joe, the conversations are worth every penny.
Planning for Longevity
In order to develop an effective long-term plan with your client, it’s important to thoroughly understand the client generations you’ll be working with.
Over half of the children born in the industrialized world after 1990 will live one hundred years. These statistics aren’t correlated mainly to your doctor, nutrition or exercise, though; higher education and income can even more reliably predict a person’s lifespan. Because of this, how we are living is changing. Instead of asking kids “what do you want to be when you grow up?” it may make more sense to now ask “how many things do you want to be when you grow up?”
People consistently read books on absolutely everything from saving to parenting, but at 65, there’s much less advice. Suddenly, the dominant picture is “old people walking down the beach” when they think of retirement. For many, there appears to be a death of their long-term visions on what to do next.
Joe explained that our industry can assist clients through this stage of life. We must help our clients picture what it is they are buying in terms of longevity planning – a long and happy retirement – and give them the vision and tools to shape their future.
Having Conversations Beyond Finance
That vision can start from branching out beyond financial topics. Historically, older generations have seen longevity planning simply as another element of financial planning. Other tasks such as moving are certainly not at the top of their mental checklist to discuss with their advisor. But the incoming generation is changing what they are looking for in an advisor. They often want to discuss their overall life plan with someone who is confident and an educator, coach, and can do the algorithmic calculations to get them to a place that they want to be.
But the problem stands, Joe shared: We’re currently facing this entirely new, unprecedented market. The pandemic accelerated values that were already out there in the marketplace, and it completely reframed how we thought about wealth and our existential existence. This industry has done a great job focusing on finance, but the client is now asking for more: relatability, social wellbeing and wanting to talk about more than stocks and bonds.
With all of the collateral material you’re providing to clients, you must set the right tone. These individuals want advisors who care about them – they want to develop their materials, specialists and life around their longevity – not just their money. Consider this conversation to be comprehensive – they don’t want to just buy a product or service; they want a solution.
Discussing Long-term Care and Caregiving
To prepare our clients for the great wealth transfer, we need to talk about topics beyond retirement. People often have trouble envisioning their future selves (i.e. going to an assisted living facility), yet we must find a way to prepare them for that future today. Individuals are most likely to get disabilities when getting older, one way or another. As advisors, we are able to help them prepare for their future lives and manage their wellbeing, both today and tomorrow. Don’t skirt around these topics – instead, give clients the permission to plan, prepare and invest for them.
Another key topic of conversation is caregiving – loosely defined as an unpaid individual helping with activities of daily living or medical tasks. Oftentimes, the eldest daughter takes on the responsibility of caring for their loved ones. An eldest daughter who is taking care of a sick parent could be costing herself promotions and a successful career, but often she fulfills this role because it is “pre-assumed.”
It’s essential to have open conversations with your clients about if they will need to take on caregiving roles for their parents and how they can prepare for this. Likewise, acknowledging caregiving as a real and tangible future possibility is paramount. These conversations may be uncomfortable, but talking about them sooner rather than later could enable clients to set aside funds and open the possibility of hiring a third-party caregiver, freeing up their family members’ time.
Reframing Long-term Care
As Coughlin shared, it’s easier to sell life insurance than long-term care. He explained clients can usually see themselves as dead, but they can’t picture themselves as disabled. This usually isn’t the first thought when anyone thinks about their future retirement.
But redefining long-term care insurance is certainly doable. As an advisor, you can plan for nearly everything in the foreseeable future, but of course, you can’t know exactly what accidents or disabilities could come into play, which could affect planning for costs of care. As the advisor, you must show empowerment to your client, while also expressing a sense of urgency, because whether we like it or not, life comes at you when you least expect it. It’s best to have these conversations now, rather than after the fact, when your client is relying heavily on family or struggling to pay for their own caregivers or assisted services. Avoiding this planning initiative can lead to a more fearful, worried, overwhelmed client who will potentially be financially at-risk when it comes to struggles down the line.
Longevity planning is complex and at times challenging, but it's worth the effort. With clients expecting more from their financial advisors, it's important to understand their needs and goals beyond finances. By reframing long-term care and empowering clients to plan ahead, advisors can create more comprehensive solutions that meet their clients' needs for a happy and fulfilling retirement.