The current backdrop and setting for retirement offers advisors a unique opportunity to become a more relevant part of their clients’ lives, redefine the context within which they provide advice, and maximize their influence over life’s final and most sought after phase of life.  This opening conveniently coincides with both the needs and desires of new and soon-to-be retirees’ who want to stay relevant, have an impact with their investment dollars and, in doing both, redefine the context of retirement.    

The greatest desire of most baby boomers is not necessarily to retire with enough money to live happily ever-after, to take a road trip across the continental US in an RV, or to cover the outrageous tuition costs of their grandchildren.  Instead, they crave and aspire to be relevant!  It’s a theme that resonates with boomers of every age, background, and net worth.  It’s not only becoming one of the hot buzz words for new and soon-to-be retirees, but also for advisors who want to be more relevant to their clients and prospects. 

Basically, being relevant means being connected, affiliated, or part of something bigger than oneself.  This, of course, shouldn’t come as a major surprise because it supports fundamental human psychology.  According to Maslow’s hierarchy of human needs, the desire to belong comes right after our need for food and water and the desire to feel safe.  What’s makes it a meaningful trend is that more and more people are verbalizing this need for relevance, and seeking solutions.  Boomers don’t want to become obsolete, or be perceived as irrelevant, disconnected, or unproductive.  It goes against everything they have sought to achieve.  

Taking the concept of relevance one step further, when you apply Maslow’s model to retirement, you can see that in order to achieve a happy and meaningful retirement, a retiree must achieve a sense of community or belonging.  First they need enough money to feed and clothe themselves, as well as feel safe and secure in terms of lodging and medical supplies.  Then comes the need to establish a connection with others, after which they can proceed to meet next level needs, which can include personal achievement, independence, and self-fulfillment.  That’s the longwinded version of saying if you want your clients to achieve a successful transition into retirement you need to help them find ways to stay relevant. 

There are countless ways to help clients feel relevant but I want focus on Impact Investing, a growing area of interest for baby boomers that relates directly to the Financial Services industry.

Impact And Influence
Generally, one of the most difficult things to do in financial services is connect the soft side of the business (the mental and emotional aspects of retirement) with the products and services we offer.  That’s changing rapidly, and its being driven by aspects of socially responsible investing (SRI), or more specifically, impact investing.  What’s unique and often undervalued about SRI is its ability to allow a client to blend their actual investment dollars with their desire to feel part of larger issues.  In the past, financial services offered clients a relationship with an advisor but not necessarily with their money, let alone other people with the same values and beliefs.  Now, as personal savings have replaced pensions and people have a growing awareness of issues such as water scarcity, pollution, and unfair labor practices, the options available through SRI help bridge the gap between the soft side of retirement and the harder dollars and cents. 

I’m not suggesting you convert your entire practice to an SRI model, or even develop a new set of SRI portfolios.  If, however, you wish to extend your influence within the retirement planning process (and that of your clients) advisors need to become aware of the growing SRI market and its ability to meet a variety of client needs.  Generally speaking, my clients aren’t looking for a complete SRI portfolio; but I do get requests like that from a vegan who wanted to avoid genetically modified foods and fast food chains; or that from a small business owner who wants to avoid investing in certain big box retailers because a family or friend’s business went to pot after the local warehouse club moved in; or from an investor who lost a loved one due to toxins associated with coal or tobacco industry; or from a religious-minded client who wanted to put money in a faith-based fund.  It’s all about advisors using SRI components to empower clients; to foster a personal relationship between clients, their money and like-minded investors.  As a result, everyone involved feels more relevant and fulfilled. 

Along the same lines, I have found a growing level of curiosity in crowdfunding and impact investing on a local level.  In both cases, the investor is writing a check to an individual or company, rather than depositing it into their investment account.  Obviously, this tactic comes with some noticeable dangers (including incidents of fraud) yet more and more boomers like the idea of either starting their own local business or diversifying their portfolio to include shares of the companies they prefer.  As an added benefit, having or working with a local business has a way of helping new retirees fill their time and replace their former work identity … both critical and often under-planned aspects of retirement.

Context For Advice
On both the advisor and client level, relevance and influence come with an inherent change to the context within which we deliver advice.  First and foremost, I have found that the starting point for most new client relationships is education.  People have large amounts of savings that need to be managed; they don’t want to make a mistake with it, and yet they want to use it to be relevant and influential. 

Therefore, advisors who are willing and able to educate, can not only use their role of teacher as a way to validate their expertise but also differentiate themselves from other advisors.  Back in the day, this philosophy would have got you kicked out of a firm quicker than failing your Series 7 exam.  The old mentality was to keep clients in the dark so that they always needed you.  Nowadays, though, there is so much information out there that people don’t know how to decipher it.  More than any previous generation, boomers are also responsible for making their money last longer.  As a result, they feel the need to keep up with a certain baseline of knowledge, which creeps higher and higher each year.