3 motivators to help clients have difficult conversations
Getting clients to plan for diminished capacity is difficult, but not impossible.
COVID-19 has been particularly hard on older Americans. They’re at greater risk of illness or death as a result of the disease, but they’re also at a time in their lives when financial losses have a more severe impact than for younger people. A report by the Society of Actuaries offers suggestions for financial professionals who work with older people to overcome common objections to advanced financial planning.
Related: The role of retirement plan advisors in the post-Covid new normal
SOA acknowledges that uncertainty makes planning for the future “feel like a futile exercise.” However, “at the same time, older people are more acutely aware that illness and disability can strike at any time. Preparing for changes in financial capacity is essential for a secure retirement.”
SOA conducted interviews and focus groups for the report. Respondents included professionals who work with older people, like health care providers, elder law attorneys and financial advisors; and people 65 or older.
1. Empowerment
The report noted that empowering messages from last effective, particularly those centered around power and control. Professionals also noted a preference for fear-based tactics, highlighting the potential loss of autonomy or risk of victimization, but unsurprisingly, these types of messages were less appealing among older focus group members.
2. Impact on others
Some professionals said they focus on the fact that clients’ loved ones will likely take responsibility for them whether they plan for it or not; the difference is that planning can make the transition easier on spouses or kids who are thrust into a guardian position.
“When financial advocates are placed in the position of making important decisions without prior direction, disagreements can arise among people who want things done differently,” according to the report.
SOA warned against using the word “burden,” though. Focus group participants were more comfortable when the conversation focused on avoiding conflict.
3. Storytelling
Storytelling is another powerful motivator, SOA found. Some clients may have already been through a situation where they’ve had to provide care or make decisions for a family member. Getting them to share those stories, or advisors sharing their own stories of vulnerability, can get clients to open up and think of how they’d like to be treated or cared for in that situation.
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