The spectacular reputational suicide of Southwest Airlines is a very public example of what happens when you promise and don’t deliver. It’s also a warning to the retirement advice industry, which is equally unprepared to ensure the safe retirement “arrival” of our best clients.

In late December, Southwest faced a perfect storm, when its business model of point-to-point plane routing was snowed under by logistical and technical snarls. Mother Nature’s wrath gave no relief for the countless thousands of customers left stranded without options—or to the employees who took the heat on the front lines. The scale of the failure made headlines, but the real pain was felt by real people counting on the company to do its job.

Southwest is in trouble simply because it didn’t deliver the service its customers paid it for. That expectation—that people will get where they want to go—has things in common with retirement planning. Southwest takes us to cities; we take clients to “retirement” or to their “next chapter.” If we fail to get clients to their destination, how would we be different from Southwest during its holiday fiasco?

Here’s what our clients ask us every day about their own final destination:

1. How much money do I need in retirement?
2. How much do I need for healthcare?
3. How will I pay for healthcare, especially as I get older?
4. Will I be able to age in my home?
5. Will I be able to help my family members?

There are many “ifs” and “depends” in these questions.

• “How much money” depends on how long you live, how much you spend.
• Healthcare costs depend on your health and where you live and your preferences.
• Aging at home is a complex topic asking comparison to the Rubik’s Cube. Even picking a spot is hard. Ask my mother from Sanibel, Florida, left homeless by a hurricane.

It’s complicated stuff, with no easy answers. Kind of like running a national airline.

We Own The 'How'
The solution is our problem.

The Southwest flier expects the airline to deal with weather, mechanical issues, baggage transport and crew scheduling. Very few of the airline’s customers care about the details, like obsolete software.

Similarly, people trust their financial advisors to know what their retirement variables are—the time lines, the assets, the cash layout—and to manage them. Both retirement clients and airline customers care most about getting to the destination. “We got you close” does not work. As “pilots,” if you will, we are responsible for how they get there, which means understanding the resources we have and the environment we must contend with. Airlines must work with unions, airports and Mother Nature. Advisors contend with Mr. Market and the Federal Reserve. And every one of our retiring clients is a first-time flier.

We Own The Complexity
One of the first business applications of supercomputers was in airline scheduling, where the computers sorted out routes, gates and crew. Consider the mind-numbing array of variables in this situation: You have a national labor force that’s constantly on the move. There are hundreds of planes, thousands of mechanics and millions of bags. When you bring that all together for a one-way flight that costs $99, you’ve set sky-high expectations for not much pay. If you go further and promise to make it simple, easy and inexpensive, you still have to deliver. And if a customer’s flight is canceled on Christmas, they aren’t going to be impressed by all the intricate logistics behind the promises.

Those of us offering retirement advice also have to take on some responsibility for the complex ecosystem we’re working with if we want to forge reliable outcomes for our clients. We have to understand the value of their work benefits, the impact of taxes, the role of asset location and the protection of income. This is complex stuff, too, something we must acknowledge if we’re going to be credible with clients, who, like airline passengers, are also focused on the accuracy of the outcome, not on all the logistics.

It’s also up to us to tell them when they cannot fly. Often, it’s an advisor’s job to tell clients they should delay retirement unless they are willing to make meaningful, and possibly painful, adjustments to their spending and lifestyles. The conversation can be unsettling, but it goes with the territory if we want to ensure the safe landing they expect. It’s certainly a better solution than “winging it,” a situation many do-it-yourself retirees end up doing far too frequently.

“Retirement” has been sold too often as a discount fare. It’s not simple, it’s not easy, and it will change as we age. There are tools and capabilities to help plan, but too often both advisors and clients project and plan without stress-testing the forecast outcomes. Retirement is a journey, and there are difficult moments, but these should be anticipated. Tossing guesstimates about your age and health and retirement spending into an online gonculator is not real planning. And it shouldn’t be advertised as such.

Don’t Wait For The Holidays To Upgrade Your Software
As the Southwest beatdown continues, members of senior management have been indicted for failing to invest in the things the airline needed to run. But the lack of preparation was well known, and both Southwest customers and employees saw the trouble building over the past couple of years, when pilots and flight attendants struggled to find their assignments, customer service frayed and flights were scrapped. These early warnings were likely ignored during Covid-19, when Southwest got a pandemic pass. That raises the question: If everybody knew, did they not care?

It’s a pertinent question because those of us in financial services are worrying that this could be our fate too if we aren’t careful. And while we cannot know why Southwest’s leadership team did not heed the signs and the warnings, we can at least try to avoid their fate.

Steve Gresham is on a mission to improve longevity and “retirement.” He leads an industry initiative, Next Chapter, and is CEO of the Execution Project LLC, a consulting firm. He is also senior educational advisor to the Alliance for Lifetime Income.