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RETIREMENT PLAN INVESTOR
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CE credit: 1 hr., CFP and CIMA
60 MIN WEBINAR
WILL MCKENNA Hello, and welcome to the PracticeLab webinars series, where we help you build your business, engage your clients and scale your practice. I'm your host, Will McKenna, great to be with you. We want to thank everybody for joining us today. You know, our topic today is how to reinvent your retirement playbook. And listen, I think you're in for a real treat, because you're going to get access to a brand-new research study from Capital Group called “Retirement Redefined.” And then, more importantly, you're going to walk away with four actionable ideas on how to position yourself as a retirement planning specialist. And we're going to give you the tools you need to take action on that.
WILL MCKENNA Now to help us break it all down today, we've got two very experienced and great speakers with us, Kate Beattie and Chris Gies. But before I introduce these guys, let me just get a couple of the housekeeping details out of the way. CE credit is available for both CFP and CIMA designations. You're going to see that on the screen. To get credit, you've got to stay till the end of the event, at least 50 minutes, and complete a short quiz. And you can find that quiz in the “additional resources” portion of your screen, where you'll also find today's slides as well as a bunch of other great materials. Also, you're going to see a Q&A window. We love getting your questions and comments. We'll try to answer as many as we can throughout the event. So, keep them coming, type them into that Q&A window any time. If you do end up with any technical problems, please let us know in that same Q&A window.
WILL MCKENNA So with that, let me introduce today's speakers. Kate Beattie is a senior vice president and a retirement income strategist with Capital Group. Kate has 14 years’ industry experience, has been with Capital Group for three years. Prior to joining capital, Kate led the Advanced Strategies Group at Jackson National. She's got a bachelor's in economics from Colorado State University. She has the certified financial planner, so she's a CFP, but also the retirement income certified planner and the certified funds specialist designations. Kate lives in Denver, joining us from Denver today.
WILL MCKENNA Chris Geis, old friend of mine, is the director of Advisor Practice Management at Capital Group. Although he doesn't look [like it], he has 37 years of investment industry experience. He's been with Capital for 17 years. Chris, like many of you on the call today, started his career as an advisor and then rose through the ranks at EF Hutton. Remember that name? PaineWebber, remember that name? Before becoming a national sales manager at UBS PaineWebber. So, suffice to say he sat in your chair and knows your world. He holds an MBA from Eastern Michigan University and is also a CFP, certified planner. Chris is also joining us from the West in beautiful Park City, Utah. So, guys, great to have you. Welcome to the program today.
CHRIS GEIS Thanks, Will. Great to be here.
WILL MCKENNA So let's go ahead and jump in. I want to take a quick look at today's agenda. We're going to talk about why retirement can be a time of disruption, what it takes to build up your retirement relationship alpha, and then how to innovate your retirement playbook. And in that section, the second half of today's event, we're going to go through a four-part retirement playbook with you and the specific steps you can take to future-proof your practice. You're not going to want to miss that. So, guys, that's enough of me blabbing. And Kate, why don't we get started with you. If you could kick us off and explain why retirement can be disruptive to adviser practices?
KATE BEATTIE Yeah. Well, thank you. Retirement is going to be a major life change for so many. So, advisers, this is both an opportunity to support our clients in a new way, but it also has the potential to really be quite disruptive to your practice. So, we know life events can create a pivot in your clients’ lives, and you can see that by some of the statistics here on the slide. There are high rates of grey divorce. In fact, for those aged 65 and older, the rate has tripled, and 70% of wealth transfers move away from advisers. So, all of these are flashing red lights that advisors really need to heed. During some of our research, there was a retiree named Frank, age 66, who said what I thought was so powerful. He said, “My financial advisor asked me, ‘What are you going to do with your money?’ But the question I really needed to be asked was, ‘What are you going to do with your time?’”
KATE BEATTIE So let me share with you a real life example of what can happen if you don't make a client feel comfortable with you, the financial professional, and your experience. So, I worked with a financial professional; we're just going to call him Dave. You know, Dave has over $300 million in assets under management, been in the business for well over 20 years, even holds his CFP. Well, one day he got a request to transfer the assets, all of the assets, out of one of his biggest clients worth over $3 million, generating about $30,000 worth of revenue.
KATE BEATTIE So Dave had a great relationship with this client and even served on a board with him outside the scope of their financial relationship. Well, he quickly called that client to ask why and the client's response was, “You know, Dave, you've done a great job helping me accumulate wealth, but as I start to pivot into retirement, I want to work with someone who really specializes in retirement income planning. Someone who I can count on to help me get through retirement.” Dave really didn't know what to say and where he went wrong. He's now lost one of his best clients, and I really hate to say it, Will, but it's just one example of many that I've heard from advisors that are so similar.
KATE BEATTIE So the first thing we really need to understand is that there is a mind shift, mindset shift amongst retirees. Our recent research reveals that this shift reflects attitudes that more retirees view this time as progression and stage of life, rather than regression from life. They feel more empowered. Modern retirees see this period as a chance to reinvent themselves and create that new life. And as part of this, they're also reexamining their relationships, and that includes their professional ones as well. So, each of you are really in a great spot to help support clients as they explore this next phase of life. And by doing so, you're building your relationship alpha, evolving the advice you give to benefit the investor and meet their ever-changing needs at each phase of life.
WILL MCKENNA That sounds outstanding, and I was really struck by this quote around, or the stat around, 70% are moving away from those advisors. So, it's really important, and that's what happened to Dave, right?
KATE BEATTIE Yeah.
WILL MCKENNA What a key transition point, a time of risk and opportunity for advisors. Chris, let's bring you into the conversation. You know, it sounds like a gap. There's a gap out there between what advisors tend to focus on, whether that's accumulation in Dave's case, or other things, and yet what retirees want to focus on. What's your perspective on this?
CHRIS GEIS Yeah. Will, you're exactly right. And that gap, it's a communications gap. And we as financial professionals, we're naturally going to gravitate toward the financial aspects of retirement, right? We see it as our role to discuss costs, expenses, investment strategies, financial risks, and all of that with the pursuit of sustainable retirement income. But what we sometimes miss is focusing on the client's life. I mean, sure, clients understand the importance of income as a means to an end, but when they're transitioning to retirement, Will, what's top of mind for them is what will their life look like? Where will they live? How do they stay busy, relevant, healthy? And, kind of, what are their options in all those regards? And what we're emphasizing is advisors today need to humanize the retirement planning experience and expand that lens to include the why behind their finances. So, the conversation should grow beyond a discussion of health care costs, market performance or inflation outlook, and the order should probably shift too.
CHRIS GEIS What we're suggesting, Will, as you can see in this slide is that advisors should flip the conversation. First, ask clients about their vision for goals for retirement. And now this could obviously it can be less defined depending on the client's age, but it's important to have them start articulating what they might want in this next stage of life. The idea is it's building toward a financial foundation that will support this vision. So asking and answering questions like, “Do you see yourself working in retirement? If so, at what? Where do you want to live? Do you want to live close to family or a new place entirely? What sort of legacy goals do you have?” Will, done this way in a context of a goals-based approach to planning, we can provide a framework to investors to achieve the outcomes they most desire in life — their highest priority goals.
WILL MCKENNA That's outstanding. I'm seeing an early question from so many of the audience. The 70% stat, that was really that money becomes in motion there, that 70% of clients tend to move from their accumulation advisor to a more retirement-focused one. We'll get you that source information too. Chris, great information. I'm scribbling notes here. I love that idea of humanizing the experience as you pointed out. And also is it time to kind of flip the script, you know, and start with more of those life planning issues before you get to the financial planning one? So it sounds like advisors not only need to kind of change the conversation, they also might need to expand the scope of services that they provide. Is that fair to say as well?
CHRIS GEIS It is. Well, the financial picture, it's incredibly important, no doubt. That's why people hire advisors. But as an advisor, we also want to assuage fears about running out of money, put in measures to protect principle and minimize taxes. That's just one part, though, of a holistic retirement services program. In fact, there are four themes that we found shape happiness and well-being during retirement. And, and the four themes are financial planning and investments, health and wellness — those two, they're the ones we commonly think of — but the two we overlook are social and life planning, and values and legacy. And each of the themes is important and, in totality, they're a great framework for thinking about your client's whole life experience.
CHRIS GEIS These themes interact with each other, and when one goes out of balance, it can pull the others out of balance. I'll give you an example: Think of a retiree who begins connecting to a community organization that supports her desire for purpose and a strong sense of value. So, what happens next? Her social life expands, that activity bumps up her happiness and, potentially, her health. And she might then have some new financial decisions, like whether to make a donation or accept a paid volunteer position. She might also think about leaving part of her inheritance or, or a legacy to that organization. And Will, these themes, they're the backbone of crucial conversations and planning for retirees, because they tell the story of retirement well-being and, importantly, happiness.
WILL MCKENNA That's great. I, and I picked up on the idea you said around, you know, some of the elements that are often missed are those social and life issues, and then the values and legacy. I've got to imagine, if you're an advisor who can really bring that to the party, that that's going to help differentiate you in your market. And I know we're going to talk about the three Ds of differentiating your brand in a few minutes, Chris. I'm looking forward to that. Hey, let me say to the audience, we'd like to have a little fun on these events. So it's time for our first poll. And we're going to have a little fun here and ask you to respond to the poll that you see on the screen.
WILL MCKENNA Now let me point out and, and my production team has told me, you're probably going to need to, on the link that you see, right-click on it and open it in a new window. But let me read out the poll to you. Now, I want you to pick the answer that best represents what you're doing today. So here it is. Do you talk with your clients about the nonfinancial, more those psychological aspects of retirement? So your choices are: A, yes, this is a regular part of my client conversations; B, this comes up more reactively because I'm focusing mostly on the financial stuff; C, I'm not sure exactly how to incorporate this, and I want to learn more; and then D, I don't, because frankly I'm more comfortable with strictly financial discussion.
WILL MCKENNA So if I had jeopardy music and, and I could play that without getting in the, in the copyright trouble, I would do so. But go ahead and imagine that playing while you answer this question, and let's see what the results are. It looks like we're getting a lot of A and a lot of C, so probably good news, guys, in terms of it's a regular part for many of you. And then a lot of you are also picking C, which is not sure exactly how to incorporate this. And presumably that's why you're here with us here today, because we can help. Great. Thank you for that response.
WILL MCKENNA I'd like to turn our attention now to Capital Group's new research study, and this is called “Retirement Redefined.” I think you're going to get a lot of value out of this. We're going to share with you how to download this so you can take it and start to use it in your business, but let me give you a quick overview. The study is based on essentially interviews with recent or near retirees on their changing retirement experience. We also included insights from retirement experts and influencers who are literally shaping modern perceptions of retirement.
WILL MCKENNA So we've got insights: not only what it means to be a modern retiree, but also how you in the audience as advisors can engage with them more successfully. So again, at the end of this, we'll show you where and how to download this so that you can use it, but let's hear from Kate and Chris. You know, Kate, you were very deeply involved in this research. Give us a sense of the key takeaways that advisors should be thinking about.
KATE BEATTIE Yeah, thanks Will. Amazing research to be a part of. It was such an amazing group of folks here at Capital too. And first, I just want to take a moment to ask everyone joining us today, as well as my friends on the panel with me, picture someone who's retired. What comes to mind? You know, the mental image that you all may have just formed may be shaped by stereotypes, and retirees are concerned with facing ageism as they transition to and through retirement. Retirees are telling us clearly and passionately that retirement today isn't about marking an end. It's about the beginning of a journey. It isn't about exiting a career. More and more often it's about working, whether paid or unpaid, but on your terms. It's about reengaging, re-socializing, rather than disengaging. And rather than being set in their ways and conforming, retirees are curious, they're exploring, they're liberated and bold.
KATE BEATTIE So this research was so telling and inspirational. I'm excited to share some of those key themes we saw, which were life reformation, seeking vitality, and rethinking relationships. As financial professionals, you can benefit by really having a deep understanding of each of these. So first let's start with reforming my identity. The driving force for this first aspect of retirement is answering the question of, “Who am I without my obligations?” A quote that summarize this well of how retirees often feel about this stage is again, going back to our friend Frank, age 66, who said to us, "I think people assume about retirement that it will be rewarding, and like the idea of not having to get up and go to work every day, but no one asked me, ‘What are you going to do with all of this time?’"
KATE BEATTIE At this stage of life, retirees are feeling freedom and independence from some of those rules, perhaps for the first time in their adult lives. For example, one of the retirees told us that his wife just decided to take a job as a seasonal employee with Delta so that they could fly for free. So working in retirement is less serious for many. They can relax, and they can enjoy it. Life reformation is about taking the skills, interests and knowledge that you've built over those decades in our working years and applying this to design this next phase of life.
KATE BEATTIE The second aspect was displaying vitality. Retirees in our research were consistently seeking out ways to engage the world and prove they're not done yet. You will have those clients feeling that there's not enough time, and also those that are unsure with what to do with their time. Many retirees feel that they're fighting to maintain some of that relevancy. One of our retirees in the interviews relocated to his second home after retiring from a very successful career in health care. He told us, “I miss having a purpose and making a difference in people's lives.” So now he consults and stays active by waking up at 5:00 a.m. every day to train for marathons. He does long-distance cycling. He says that this fills his EVP index: energy, vitality and purpose. Think about that. He created a measure for his own vitality each and every day. Pretty cool.
KATE BEATTIE The final aspect we saw is rethinking relationships. So this aspect really reflects how retirees invest in the personal connections that they have that drive contentment and growth. We saw Sally, age 69, one of the retirees we interviewed, vocalized her strong desire for deeper relationships. She said, “Financial advisors are like doctors now. Get in, get out, overly focused on the numbers rather than the person. There's no relationship.” While we understand that isn't always the case, it really is about meeting your clients where they are and want to be met. This includes couples as well. You know, fewer than 20% of couples retire at the same time. Divorce rates for those 50 and older have doubled, while those aged 65 and older have more than tripled, as I mentioned earlier.
KATE BEATTIE Some of our retirees were very candid about that. We interviewed a lady named Lisa, age 64, and she said to us, “This should be a time of freedom, but I feel like I'm hiking uphill with a huge iron ball shackled to my ankle,” as she was referring to her husband. “It just isn't what I thought it would be. My husband and me are so different as we age.” And to be very candid, I see the same thing with my parents who just celebrated over 43 years of marriage. My dad wants to get out and see the world, volunteer his time to stay social, while my mom is content in her bubble with her routine. So it's important for financial professionals to really be tuned in to these shifts and provide your clients with those meaningful relationships that they're really searching for.
WILL MCKENNA That's outstanding, and I was really taking a bunch of notes there and struck by, man, who is this guy who's waking up at 5 and doing marathons? He's got the EVP index. I, I'm not retired and not, I'm not doing anything like that. I got to, I got to crank up what I'm doing. I don't know, Kate and Chris, if you're that active, but man, this is incredible. And Kate, interesting story about, you know, in your own life, your, your, your parents and some of the differences in their goals and aspirations. I know we're going to come to that later.
WILL MCKENNA This idea that, as an advisor, one of the important things you can do is counsel couples to really both share their own points of view about what's important to them, and then help them find those middle grounds, or find a way to, to pursue each in their own way. So, I mean, wow, I'm, I'm just struck by how much there is in this report and how dynamic all this is. So, you know, Kate, sticking with you, what, what does that mean for advisors who are trying to help and create and execute these retirement plans for, for clients given all this dynamism?
KATE BEATTIE Yeah. I mean, we've talked a lot up until this point about the dynamic and rewarding and daunting part of retirement, the retirement journey that this can be. And we know it's also unpredictable, you know, no one knows their future. No one plans, everyone’s plans do change, circumstances, preferences, all of these things changing. So on the slide you can see here some quotes from retirees that we interviewed. For example, we see James. He's really concerned about being ready for the unforeseen, maybe a health crisis, and making sure that he has that revenue stream that protects him. We also looked at some great research on retirement from Gallup, and it's comparing what near-retirees expect from retirement versus what actual retirees are experiencing.
KATE BEATTIE One of the themes that emerged from that research is that even retirees close to that retirement milestone are typically expecting something very different than what retirees are truly experiencing. This includes: the age at which they'll retire, usually younger than planned for; how income constrained they'll feel, which is usually less constrained than inspected, expected; how they'll spend their time, more real life, less vacations; and what they're going to spend their money on, you know, more housing and health care, for example. So this means you really need to check in with those nearing retirement, as well as in retirement, regularly and mention the range of, range of planning support that you can provide to them throughout the various phases of life. Plant the seed, water it, and be available to them.
WILL MCKENNA That's great. And I, you know, Kate just shared so much, so many insights there based on the new research and, and some great, kind of, stories and examples. Those of you in the audience, we'd love to hear from you in the comments section. Let us know any particular points that are resonating with you. Have you seen similar things in your own experiences, similar examples? Give us a sense of what's resonating with you within this or, or, or what's not. OK. And we'll keep an eye on, on the Q&A and try to bring those stories back. So I appreciate that.
WILL MCKENNA Let's do this. So far, we've gotten great context on some of the new research, some of what's going on in retirement, how it's changing, how it's kind of a disruptive time. You know, again, that stat 70% might be moving advisors. We've, we've covered the why and the what for why, what's going on out there. Now it's time for us to turn to the how and, you know, it's our goal in PracticeLab and with our practice management program at Capital to really not just give you interesting information, but to really help you then act on that and, and improve your practice.
WILL MCKENNA And so what we want to do now is turn our attention to the four elements that are involved in this retirement playbook and how to innovate that in your practice. So, Chris, I know this is near and dear for you, and step one is really this idea of building out your retirement brand. Give a sense, how are successful advisors doing this today?
CHRIS GEIS Yeah. Well, Will, I mean, you've seen our “Turbocharge your brand” webinar. You'll remember, if you, if you can recall, we, we talk about the three Ds: differentiate, define and demonstrate. And these also apply in the retirement context. The first step: define. The key in this step is avoiding the Dave scenario that Kate talked about by making it clear that you provide these sorts of holistic retirement services, and that you, as a financial professional, you're clear to as whom you serve, why and what you actually serve them. And, and you should know, clients are looking for you. There are more than 750,000 searches under the heading “retirement advisor” every year.
CHRIS GEIS So the second step, and, and perhaps this is the most important: differentiate. In retirement, that differentiation, it really comes down to three factors. Income longevity, emphasizing that you're not only working with them to save for retirement, but you'll also be there as they spend in retirement through both planned and unplanned events. Second, retirement, life decisions. Show them you're prepared to help them explore what they may want in retirement. And, and these are things like we referred to earlier. Where do you, where do they think they want to live? What do they want to continue doing, and maybe continue working in some fashion?
CHRIS GEIS Show them that you understand finance. Finances are a tool to achieving that next successful stage in life. And then the third, advisor retirement capability. Reinforce this message to clients that they should have no question that you're the advisor to lead to and through this next stage in life. Don't assume that they'll think of you as opposed to a retirement expert simply because you are the expert at helping them save for that retirement.
CHRIS GEIS And then the last step: demonstrate. Lots of ways to do this. The best one is integrating this capability into your digital presence. And we, and we can talk more about how to do that, but we have an entire program that we've developed at Capital to help you here. It's called “Prospect and grow” in our new digital reality. And if you want to learn more, reach out to your Capital Group wealth management consultant, retirement planning consultant division, divisional or internal wholesaler.
WILL MCKENNA I love that, Chris, and, and great point there about, boy, we've got some existing resources on PracticeLab. And, and within your team, Chris, the practice management specialists that can help you get going on this already turbocharging your brand, the three Ds — define, differentiate, demonstrate — you know, now tailoring that for this retirement phase. And then also your point about prospecting and grow with this in mind. So, yes, you're going to hear from us several times during this event. Reach out to your Capital Group team; find out how you can take advantage. We probably have a lot more resources than you realize that you can take advantage of, whether that's tapping into Chris and his team to take this to the next step, or working with your local sales teams to take advantage of all the great resources. We'll come back to that again.
WILL MCKENNA Boy, I hope that you in the audience took a couple of notes on this 750,000 searches for retirement advisors. You all in the audience, you want to come up on Google page one. Let's keep going. You know, Kate, I'd love to hear from you here and, and why don't you walk us through step two, which is the interesting idea of this client engagement roadmap. Tell us more about it.
KATE BEATTIE So, as we think through this roadmap, as you can see here on the screen, the right client communication is key to that retention. So when you start to systemize, systematize some of those key conversation touch points in your practice, this is one way that you're making sure you start the conversation early, and then you continue it often. Again, this is how you can avoid a Dave situation. So the days shown here are going to be a general starting point, and they're going to vary for each client. But as we start to think about demonstrating our brand, we want to definitely do that five years prior to retirement. This could be that first table setting conversation on retirement needs. It's important to get early, get in early, before they get that AARP card in the mail. And you want them to think of you as their to and through retirement transition specialist.
KATE BEATTIE So flag the accounts of clients so that you can talk to them early, before the year that they turn 50. And then, for some of your older clients or perhaps those that you've acquired along the way, make this discussion a top priority in your next meeting, or call a special meeting just focused on retirement beyond the financials. Then make sure that retirement and all that it encompasses is a regular part of those future client engagements. So, for example, some conversation touch points might be suggesting that they consolidate their assets with you to make planning efficient and transparent. Help them consider their retirement date or age, if they haven't already done so. “Are you planning to retire at a specific date or a specific age? Do you need to continue working past that date you plan for in retirement?” Check in on Social Security timing sometime prior to age 62 to help investors avoid some of the mistakes of claiming too early.
KATE BEATTIE Next we look at creative retirement vision. This is going to be about four years prior. You know, build on that previous conversation by asking them about their retirement vision and do some scenario planning. Do they like to continue working, or maybe begin working for fun? Where would they like to live? Now is a good time to bring in some of those experts and surround yourself with the right resources to help them get to that shape, that vision. And some additional conversation touch points might be, you know, assess some of those anticipated health care and lifestyle needs, assess their asset allocation, product location, and update any estate plans that they have.
KATE BEATTIE Next we want to help them prepare for that new place, passion and purpose. This is about three years prior. So at this next stage, you might prompt clients to start filling in the details of their retirement vision by asking questions such as, “What do you want to do more of? What do you want to do less of?” Additional touch points may include looking at adjusting expenses based on the feedback, asking, asking them who they envision spending their time with in retirement, tackle any barriers that may be preventing them from achieving their retirement goals, be it travel, volunteering, or uncovering that new passion project.
KATE BEATTIE And then we start to get closer. You know, building that foundation about two years prior. This is when it's a good time to refresh and refine the retirement vision. Does the prior vision still hold true? How might they want to tweak it? Additional conversation touch points may be to confirm the retirement date is still valid. Review those estate plan and tax strategies, as well as Social Security timing and health insurance needs. And then we're getting down to the where you're ready, set, go. We've got that one year prior to retirement. And this is where you're supporting your clients launch to that next stage and the journey throughout retirement.
KATE BEATTIE Consider doing a retirement lifestyle dry run. You know, where clients start living on that retirement income, even while earning that full paycheck. To get comfortable with that cashflow, continue that paycheck thinking. And any excess cash that they have could be saved in liquid assets to really build upon that emergency fund that they have. Some example conversation touch points at this stage may be to confirm all their financial resources and timing of when the client could tap in to them, making sure those checks show up on time, update estate planning documents, and then encourage your clients to begin to get paperwork from their HR group as they transition out of their current employer. And then you want to review that last five-plus years. Remember, it doesn't stop here. We've only scratched the surface on the conversations that need to be had, but your clients will want to check in with you through retirement and help them adjust as their plans, priorities and needs change along the way.
WILL MCKENNA Wow, what a great timeline. And that's, there's so much chock-full in there. And I think we're going to tie this into a resource we have, we'll show you later, called a client workbook that goes through a similar timeline and can help you have a resource you can use with clients. Great stuff, Kate. I want to go back to a couple of client questions that have come in, and I do want to encourage everybody. Please start sending us questions. We're going to take them along the way, and we've got a couple of good ones.
WILL MCKENNA First, a few minutes ago, Len asked us, “Hey, I've presented myself as a financial psychologist for almost 30 years, and the slides are great, are they available?” Yes. You should be able to find those in the additional resources page. You can download that and save them to your computer. So if you have any problem with that, let us know, but they should be there for you.
WILL MCKENNA And then we got a great question here. Let me see if I can read this. I'm surprised seeing clients in our business, non-clients back at the shop or office, their former workplace, after six or eight weeks, maybe several months, back at their place of work. And the quote that he hears from the client is, "I just didn't know what to do. I got bored and tired." What might I say to them? So, Chris, I don't know if you want to start on that and, Kate, add in, but that, that sounds like a pretty common scenario. But how would you answer that?
CHRIS GEIS You know, I think it is, Will. In fact, some of the research we've done says that, you know, within a year after retirement, 50% of retirees say, “I'd really like to get back to work. I would really like to be working again.” And, and I think, Will, a lot of that comes down to the fact that we, as financial professionals, have focused so much on the investment side of it, the risk side of it. And we haven't spent enough time talking with people about their social circle and about what makes them feel good about their purpose in life.
CHRIS GEIS In other words, have you thought about whether most of your friends are tied to your employer? Have you thought about whether most of your friends are tied to your career? Have you thought about what really makes you feel good? And if we can get folks starting to think about their social life and about what, how they could achieve purpose away from their work, I think we can help more of them feel good, Will, in this next stage of life, this retirement phase of life, whether or not they decide to continue working a little longer or work at something else. If we help them make the shift in their social life and help them find other things that represent purpose to them, that's huge value that we bring, and it will help them feel good as they work through this next phase in life.
WILL MCKENNA That's great. And that's going to be a huge differentiator for advisors who can really get good at that, that kind of guidance. And I think that was Steven, thank you for that question. And I will say to you, Steven, and, and everyone on the call, in a minute, we're going to talk about this client, “My Best Retirement Workbook,” which has great information about all the things Chris just described. You got to download that. See if you can start using it with some of your conversations. I think it's really going to target the exact issue that you brought up.
WILL MCKENNA And I think I saw another interesting quick question here from Anonymous. Well, Anonymous, let me, let me answer this one. Anonymous said, “The time to start this process is when relationships are becoming empty nesters.” That just happened to me. (laughs) So my, I just dropped my second son off in college here in September. And I'm, I personally am experiencing some of this, like, boy, what am I doing with my time? This, I'm still working, but it definitely is, is a big change. And so I can, I can relate to this idea of, of changes like this.
WILL MCKENNA What I'd like to do now, I think we've got another, we've got time to do another poll here that relates to everything we've just been talking about. So let's put that on the screen again. Same thing, right-click, open in a new screen. Let me read this out to you. When do you first have the, “I'm a retirement specialist” conversation with your clients? A, is it at the first meeting; B, is it about 10 years before they retire; five years before, C; or D, this is just not part of my standard operating process. So, go ahead and pick the best answer for you as we imagine the jeopardy theme song playing.
WILL MCKENNA Ah, good, good, kind of a good mix of ideas here. Let's let that continue to settle out. Pretty impressive. 53% of you say you mentioned it at the first meeting. But then, you know, about a quarter of you say this is not part of my standard operating process, and hopefully you can walk away from today's event and help make that part of, part of your process. You know, I think what, what I would say here is, let's, let's put on the screen that workbook that we've referenced a few times. And this is, again, this idea of our best retirement workbook. You're going to be able to, to find this on PracticeLab, and we'll talk about going there later. By the way, it's also in your additional resources section of this webinar.
WILL MCKENNA Basically, this is a workbook to help you have all these great conversations with clients. It has the same kind of four key elements of planning, whether that's life planning and social goals, to legacy needs, to, of course, the financial elements as well. You're going to be able to download that on PracticeLab. You can use it. It's approved for client use. And I think you'll find that this can be a tool that can help you really elevate and accelerate your process of getting at these issues with your clients. So we'll return back to that and get into a little bit more detail on that. Chris, let's get back to our, our four steps. We're on to step number three now, which sounds really, when I first heard this great title, it sounds very intriguing to me. What do we mean by “be a retirement concierge”?
CHRIS GEIS Yeah. Yeah. Well, I, I love this part of it too. It's really, it's an expansion of your COI network. It's similar to the way many of us introduce tax attorneys and accountants to our clients. You can also connect them to resources that can support their lifestyle, vision and their desires for growth during this new time in their lives. For example, on the upper left, you can see a number of online educational resources like Ideacity. It's similar to a Ted Talk forum. And Road Scholar — like, I love this one, Road Scholar — it's an adventure travel company that caters to modern retirees. At the bottom you see Retirement Jobs, and that supports the career interests of those over 50.
CHRIS GEIS And then Encore, which is an organization with core values of seeing aging as opportunity rather than a problem to be solved. At the right, there's Retirement Wisdom. It's a site and podcasts that are aimed at supporting the nonfinancial aspects of transitioning to retirement. Aging in Place is a resource that gives modern retirees access to resources that allow them to live in their homes as long as possible. And, and these are just a few examples. As you start exploring these areas, hopefully you'll build your own resources, especially those in your local area. My guess is some of your clients were already engaging with some of these. A great strategy is just to ask them for feedback on what they're doing.
CHRIS GEIS All of this gives you another opportunity to show your clients your, quote unquote, retirement expert value. And by the way, I'm, I'm not necessarily recommending one or the other of these, rather I'm kind of sharing the kinds of resources that you could build for your clients. What I am recommending is that you have this kind of dialogue because it sends a really important message around your expertise, your passion for retirement and living successfully in retirement. By the way, the ancillary benefit is that the more you talk with clients and prospects about retirement success, the more likely they will talk about you to their friends and family, and thus increase the potential for referrals.
WILL MCKENNA You know, it's, it's a great point, Chris, and I think, I, is it fair to say as an advisor, you really want to position yourself as that first call, you know, that port of call where your client is thinking of you as a resource and a great source of ideas and referrals and resources beyond just their investment situation or their financial planning. I know, personally, I was able to talk to my advisor out here for a couple of things recently. What's the best way for me to think about getting a car for my son and making sure he's insured the right way? When he went to college, we were working on his “Hey, should he stick with our insurance plan or go to the college's plan?” And he was my first call.
WILL MCKENNA You know, my mother is down in, in Savannah, Georgia, and the great state of Georgia, and a couple of years ago moved into a retirement community down there. And her advisor was the guy we called to, to get some ideas down there. So these are, you know, outside the, the strict purview of some of that financial planning. I mean, think about it, having a great travel agent that, that, you know, your clients can rely on that, might be as, as important as having a great, you know, estate planning attorney to help them out. So I think that's a really powerful idea, as we get into it and, and Chris let's, let's continue, keep plugging away.
WILL MCKENNA And I'm sorry, I'm looking at some of the, the, the questions coming in. Here we go. I like many, and this is, could be for either of you. “I, like many other advisors, don't plan to retire any time soon. Thus, I can't personally relate to many of the topics we should be discussing with clients who are at that life stage. Any tips for being better or relating, at relating or empathizing when you may not be in that age cohort?” So I, you know, maybe Kate, Chris, you guys both take a, take a crack at that one.
CHRIS GEIS Kate, I'll leave it to you since you're furthest from that age. (laughs)
WILL MCKENNA Well played.
KATE BEATTIE I know. That's so sweet of you, but I, you know, I've ran into a financial professional, and he had a retirement wall of fame in his office, and it was pictures of all the retirees that he had helped get to retirement — the things that they were enjoying doing in retirement. So as those folks were coming through his office, it was as simple as saying, “Oh, what, what's that?” You know, and opening the dialogue that way. And it was able for him to connect retirees to other retirees that were at that stage of life.
KATE BEATTIE And so it's just another way for you to, kind of, you know, prospect and connect people of like-minded ways where they can enjoy that retirement. Find their purpose, find that vision, have that conversation that way. You probably know their financial piece of the pie better than anybody. Is there someone on your team that can maybe help tap into that other part of it, more of the, you know, qualitative components of it?
WILL MCKENNA That's excellent. I, you know, Chris, I got another good one coming in for you from, well, first of all let me before, Harris, thank you for this. Harris, I think putting a follow-up to the question I took about emptiness, he said, “You are not an empty nester until the kids are off the payroll.” Amen, Harris. Amen. But I think there's an interesting idea here. And this, this, we should probably get our, our colleague, Mike Van Wyk, to answer this one, Chris, but I'm going to pitch it to you. Is there a descriptive word to replace retirement in our conversations to reflect this new paradigm?
CHRIS GEIS Yeah. That's a great question. And, and, Will, we, Kate and I, have kicked that around with it, with, with a number of folks who have worked with us on this. The honest answer is we haven't come up with a great alternate descriptor, but I'll tell you what, we've got a bunch of smart people who are listening to this webinar and, and part of this conversation with us. So if one of them has a great idea for an alternate word, I would absolutely love to hear it. Put it in the chat box.
WILL MCKENNA Yeah. And that's why we're, we're calling this research study ”Retirement Redefined,” and, you know, we're sort of dancing around it. I don't know that we've captured the word, but that's a very good question and prompt. OK. Fourth and final step, Chris, you ready to walk us through that? And this idea of establishing a retirement GPS, which stands for goal prioritization system. Got to say, I love that. A very catchy name. Chris, tell us about this.
CHRIS GEIS Yeah. I love to Will. This is, this is exciting. You know, we talked about a roadmap earlier and, and now we'd like to give you a framework, and that's that GPS, Will, that you just referred to that'll help you help clients work to achieve a successful retirement by putting it in the context of their goals, the outcomes they most desire in life. This came out of Capital Group's private client services team and, and it's a proven system to enable a richer, deeper conversation about what's most important to clients. And, and what private client services found was that even really affluent and even very sophisticated investors can have a hard time articulating and especially prioritizing their goals.
CHRIS GEIS So what we've created is a system that's based on life's priorities. You could equate them to life's needs, wants and wishes. We use slightly different terms to equate to needs, essentials. These are the highest priority goals, table stakes, if you will, such as saving for retirement, income in retirement, college education for kids. The second level of priority is enhancers or life enhancers. These are acquainted to life's wants. Those are nice to have in life. Think cabin in the mountains, vacation home on the lake. And then the third category are the aspirational, endowments. This is establishing a charitable foundation, a legacy for kids, grandkids, maybe your college or university or a cause, it could be social, environmental, or political about what you feel passionate, and they're often planned as end-of-life goals.
CHRIS GEIS It's also worth noting, Will, that clients, you can have more than one goal in each category. In fact, most of us would have more than one goal in each category. The point is: This goals-based prioritization system is effective because it aligns with our mental accounting tendencies, our right brain emotions. And the framework also enables personalization, right? What, what's an enhancer for you Will might be in essential for me. It's, it's also important to remember that priorities change over time, right? And that makes it even more important to have regular check-ins with clients on these subjects and adjust when necessary. Those are the benefits to the investor, your clients. Also think about benefits to you of a finance, as a financial advisor of this system.
CHRIS GEIS First, the GPS gives you a way to show clients that you not only understand their goals, but also how they're prioritized — true depth of understanding beyond just telling them. Secondly, it helps you in managing the impacts of volatility and maintaining their confidence, client confidence, through volatility. You help them stay their course even in challenging markets. It builds confidence because the system helps assure they know the essentials are taken care of. And conversely, it reduces client spending concerns. People actually worry about spending too much early and then end up not spending enough. It's counterintuitive for many of us as financial professionals, but believe it or not, we see it a lot.
CHRIS GEIS So GPS for the client, it helps you help them achieve what they want most in life, the outcomes they desire, their goals. And for you as their advisor, it shows your clients you understand these goals. It gives them the confidence to follow your investment recommendations, even in the face of sometimes falling markets.
WILL MCKENNA I love that, I love that framework, Chris. A very powerful tool. So expect to see more of that from us at Capital Group, whether it's in the client workbook, and more materials to come. I want to circle back to this idea of, is there a term other than retirement? My colleague, Melissa, Melissa Phillips wrote in, “Modern midlife is what we've heard through the research. And let me expand on that to say retirees describe it as a modern midlife, a time of reimagined identity, transformation, renewed vitality, and sense of opportunity, a chance to reassess and become an even better version of yourself, no holding back.” Well said, Melissa. Well, Melissa is a senior writer on the team, beautifully said. And I think you'll find some of that again in that, in that client workbook.
WILL MCKENNA Charles also said, here's an alternate descriptor is quote, “What is the age when you would like work to be completely optional?” So interesting point there. And one other thing, thank you for all the great engagement through the, the questions in the comments. Robert made this suggestion, “Consider getting the RICP or similar designation to demonstrate your commitment and knowledge, awareness of this area.” And then Eric just wrote in, “The next step.” OK, that's great. Chris, I might ask you, Chris and Kate both, you know, you guys have shared some outstanding information here. For our audience, you know, what's the best way for them to think about it? If they'd like to go deeper with you guys or other specialists on the team, what's the best way for them to, to figure out how to, how to connect with your team?
CHRIS GEIS Absolutely, the best way, Will, and I alluded to it earlier, but I thank you for asking 'cause I want to be very specific about it. And by the way, from Eric, “the next step,” I love that. I'm going to use that. Best way, reach out to your Capital Group, American Funds wealth management consultant, your retirement planning consultant, your divisional wholesaler or your internal wholesaler. And talk with them about where you're trying to go, what your stage in your career is, what your stage in working with folks who are pre-retirement and perhaps even in retirement, what you've been doing around retirement income. They can help you connect with us in exactly the right way. And that connection may be through PracticeLab, it may be through them, or it may be through one of our specialists, like Kate, or one of the folks on our team or one of our high net worth wealth strategists.
WILL MCKENNA That's outstanding. So basically, your Capital Group, your, your local or regional Capital Group team is your kind of access point to any and all of, of what you guys bring to the table or those, those wealth consultants themselves too. One more quick one: Somebody else called it “freedom phase.” Great. I love that, too. Well, listen, this has been a fantastic conversation. I do want to, don't leave us yet. I did want to summarize a few things about what we talked about today, and so, if we could look at, kind of, the PracticeLab retirement slide. You know, this is where you can find a lot of the resources beyond what, what Chris and Kate and team bring to the table.
WILL MCKENNA Here's what we talked about today. In the first half of the event, we really introduced this idea of, hey, this, this phase of life is changing. It can be disruptive. We've got this new research study that shows how retirement's changing, why it’s so important for you all to position yourself as a retirement specialist. And then in the second half, Kate and, and Chris walked us through these four steps that you can take to reinvent your playbook. And along the way, we shared two really important resources that we want you to download today and use in your practice. The first is that redefined retirement research study. And that's, the second is in ”My Best Retirement” client workbook. I think that's going to be something you're going to be very excited about and find a lot of ways to use.
WILL MCKENNA Both of these, by the way, are in your additional resources, but they're also on the PracticeLab site, where there's truly a cornucopia of great resources. Cornucopia, that sounds like a Halloween kind of fall word. I don't know where that came from. But guys, let me leave you with two asks, two asks from all we talked about. Number one, go to the PracticeLab site, download those two resources and look around. There's a lot there that we think can help you. Number two, as Chris said, reach out to your Capital Group team about how to take the next step, whether that's trying to connect with Chris and Kate and their team, or work with your local folks, just to get better at this critical part of your business.
WILL MCKENNA So with that, I want to thank everybody for coming. That's all the time we have today. Kate and Chris, thanks so much for a great discussion. We hope everybody in the audience found this helpful. Don't forget to take advantage of the additional resources attached to the event. Thanks again, and enjoy the rest of your day.
Today’s investors want more from retirement. No longer seen as an event, modern retirement is instead a time for reinvention in a new stage of life. Are you prepared to help your clients navigate this new frontier? Our latest research can help you innovate your retirement playbook and future-proof your practice with clients and prospects.
What you’ll get:
Who can benefit: U.S.-based financial professionals interested in being the advisor of choice for clients in or nearing retirement, and building a practice designed to meet the needs of those clients.
Kate Beattie is a senior retirement income strategist with 15 years of industry experience (as of 12/31/21). She holds a bachelor’s degree in economics with a business administration minor from Colorado State University and holds the Certified Financial Planner™ and Retirement Income Certified Professional® designations.
Chris Gies is director of Advisor Practice Management for Capital Group. He has more than three decades of industry experience and specializes in training high-level advisors on various practice development topics.
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