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Everyone in insurance is familiar with the "Round Tuit." Prospects feel retirement planning is a valid, but not immediate, concern. They will focus on it when they get "around to it." Here are some ways to move it up the priority list.
1. The government won't support you in retirement. Some people think Social Security is meant to support you in retirement. They don't realize it's part of your retirement income, not a replacement for your current taxable income. Compare what you spend today with your anticipated Social Security benefits.
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Bottom line: You will need an additional stream of income.
2. Having a 401(k) plan means you provide for yourself. Defined benefit plans were largely replaced by defined contribution plans. Does your client understand the responsibility for saving and investing transferred from the firm to the individual?
Bottom line: You need to be actively involved in saving for retirement.
3. Why leave money on the table? There might still be some people who don't participate in the 401(k) offered to company employees. Firms often match, dollar for dollar, contributions up to a certain point.
Bottom line: If you aren't contributing your own portion, the firm isn't adding theirs.
4. What's that real estate saying? "Don't wait to buy real estate. Buy real estate and wait." Patience is a virtue.
Bottom line: The longer your money is invested, the longer it has to grow.
5. It's all about financial independence. What if you could retire 5 years earlier than you expected? How about 10 years earlier? If you focus on saving and manage your money intelligently, you may reach the point when you can stop working earlier than you expected.
Bottom line: Even if you don't retire early, you would like the option to say "I'm done."
6. How enthusiastic are your kids? Years ago, people had large families because the multitude of children served as their retirement plan. You had multi generation households. One of the children might stay behind in the role of caregiver. In other situations, the children wrote checks and sent them to their parents.
Bottom line: Are your children up for the job of supporting you in retirement?
7. It's another emergency fund. When the pandemic hit, the government relaxed the rules about tapping into retirement assets in case of emergency. Circumstances might develop when you need money now to make real estate tax payments or pay your children's college tuition bills. You might not be working.
Bottom line: Retirement assets add another emergency fund option.
8. How do you feel about working forever? Is that a viable option? Some people love their work. They intend to transition into consulting in retirement. Others need more money to make end meet. Why? Because they didn't save enough. There are jobs where age isn't an issue. Firms like Wal-Mart, McDonalds and supermarkets have local jobs filled by seniors.
Bottom line: Would you consider that as an option? (Probably not.)
There are ways you can make retirement planning more attractive for your clients and prospects.
Bryce Sanders is president of Perceptive Business Solutions Inc. He provides HNW client acquisition training for the financial services industry. His book, "Captivating the Wealthy Investor" can be found on Amazon.
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Bryce Sanders
Bryce Sanders, president of Perceptive Business Solutions Inc., has provided training for the financial services industry on high-net-worth client acquisition since 2001. He trains financial professionals on how to identify prospects within the wealthiest 2%-5% of their market, where to meet and socialize with them, how to talk with wealthy people and develop personal relationships, and how to transform wealthy friends into clients. Bryce spent 14 years with a major financial services firm as a successful financial advisor, two years as a district sales manager and four years as a home office manager. He developed personal relationships within the HNW community through his past involvement as a Trustee of the James A. Michener Art Museum, Board of Associates for the Bucks County Chapter of the Fox Chase Cancer Center, Board of Trustees for Stevens Institute of Technology and as a church lector. Bryce has been published in American City Business Journals, Barrons, InsuranceNewsNet, BenefitsPro, The Register, MDRT Round the Table, MDRT Blog, accountingweb.com, Advisorpedia and Horsesmouth.com. In Canada, his articles have appeared in Wealth Professional. He is the author of the book “Captivating the Wealthy Investor.”
