I was privileged to be able to attend this the Million Dollar Round Table invitation-only event. The purpose of the interactive program: to explore the development of financial solutions to one of the most critical issues facing the financial services profession – the looming retirement crisis for baby boomers worldwide. Baby boomers were born between 1946 and 1964 and the first of them reached 60 last year.

MDRT is an international independent association of the world’s top life insurance and financial services professionals and has a reputation for staging big events in a big way; I was not disappointed!

The event was staged at the historic Hudson Theatre. Built in 1903 by an up-and-coming producer, Henry B Harris who perished on the RMS Titanic, it continued to be managed by his wife Irene, the last known Titanic survivor to be rescued in a lifeboat.

The two days included a variety of panel discussions and presentations by leading economists, authors, academics, MDRT members and other financial services professionals as well as baby boomer experts.

The opening speaker was Lee Eisenberg, author (and non-financial specialist) of the current best seller, The Number: A Completely Different Way To Think About The Rest of Your Life. His session was titled: What Financial Professionals Need to Know to Help Baby Boomers Plan For Retirement. Eisenberg spends a lot of time in the field, interviewing boomers for the financial advising world, and in this session he presented some of his latest findings. Namely, 31% of boomers would rather scrub the bathroom than work on a financial plan. “There’s a pandemic loose in the U.S. – it’s called ‘inspiration deficit disorder,’ or IDD. It’s about inertia and avoidance,” says Eisenberg. One of the problems, he says, is that boomers aren’t exactly sure what they are planning for. Many reject the traditional retirement of rest and relaxation their parents sought – they are looking for a different kind of experience, where they remain actively engaged members of society.

He reports that boomers see advisors as a blur, in many cases because clients don’t think advisors really listen to them. In addition they are confused about fees as well as about the initials following advisors’ names. And if they do use an advisor, they want either “the kindly uncle in the chair for decades, a model of trust” OR “a hard-boiled geek who is good with numbers”. He calls on advisors to help cure IDD!

Because of my interest and work in aging, I attended Navigating the Complexities of the 21st Century Wealth Span by Dr. Neal Cutler, Associate Director of the Gerontology Program, University of North Carolina at Greensboro and Vice President & Dean – American Institute of Financial Gerontology.

Financial gerontology is the teaching of gerontology to financial professionals and the teaching of personal finance to gerontologists.

His research shows that boomers are becoming the “senior sandwich generation” as 60-year-olds care for their children as well as their 90-something parents – and it’s changing the nature of financial planning. He discussed the importance of the wealth span model which is about the historical change in the nature of accumulation and expenditure. The bottom line of this model: we have fewer years to accumulate, and what we accumulate has to last for a longer period of time.

He presented a new family aging financial planning tool called the Filial Fraction to help financial advisors use financial gerontology to better prepare boomers for retirement.

My fascination with all things marketing led me to end the day with The New Rules for Selling to Boomers, presented by Matt Thornhill, President and Founder, Boomer Project (www.boomerproject.com). According to Thornhill’s research, boomers report that middle age starts at 48 and old age in the mid-70s. The time in between Matt has named middlescence. He says boomers are about entitlement, control, work ethic and optimism, so included in the top ten things financial marketers should do to connect with today’s boomer consumer are:

  1. Treat everyone differently: be aware that there are lots of different segments within the boomer cohort and you need to identify the segment you want to reach and design the appropriate sales pitch.
  2. Stay away from the negative (i.e. Don’t use the ‘r’ word) and cast your message in positive ways by using emotional images and concepts that appeal to boomers’ need for freedom and vitality
  3. Make it relevant to me; make me feel unique, different (the example he gave was the iPod, which all look the same but which are all essentially different).

The highlight of the summit for many was the evening fireside chat between 2007 MDRT President Philip Harriman and Dr. Alan Greenspan, Chairman, Federal Reserve (1987-2006). Clearly an elderly man, Greenspan exhibited the keen, sharp mind he has always been known for. He said he could solve the problems with the US social security system in 20 minutes, 15 of which would be for pleasantries, because the US pension crisis is limited and it is definable. “We have to recognize that what we’re going through is unique in world history,” said Dr. Greenspan. “Retirement is a relatively new phenomenon. As a society we’ve dealt with it successfully in the past few decades but we’ve never had such a huge group of individuals going into the system at once and then living so long in their retirement years.”

Greenspan stated that the U. S. government has over-promised and under-delivered across issues, citing the lack of political will in Washington as the cause. He called for boomers to take action in preparing for retirement.

Day two opened with Ken Dychtwald’s session: Re-Visioning Retirement: A Financial Wake-up Call for Baby Boomers. Dychtwald is a futurist and president of Age Wave(www.agewave.com), whose work I have followed for years and so I was especially keen to hear his latest insights. What women want from financial services, he says, is more security and predictability. They don’t want to worry about their money and so prefer less aggressive investments. Next he warned that to assume 65 year olds have nothing left to give is a mistake; these individuals intend to live their legacy and not fade off into the sunset. They will redefine retirement by remaining engaged and productive throughout these years. And, when selling to boomers you would be wise to remember what Dychtwald learned from recent retirement research: the majority of boomers surveyed said that their number one requirement from a financial advisor is the ability help them visualize their future.

The last session I was able to attend before having to fly back to Toronto was The Calculus of Retirement Income…For Poets by the only Canadian presenter Dr. Moshe Milevsky, Financial Professor, York University and Executive Director, The Individual Finance and Insurance Decisions Centre (www.ifid.ca). I have followed Dr. Milevsky’s work with insurance products and companies in the press but being the non-mathematician I most certainly am, his academic research and investment model discussions were only made bearable through his wit and stories about his mother! However, his comments on the decline of corporate pensions and the need for emphasis on saving and asset allocation to create a more systematic methodology of generating income for boomers hit home as did his review of longevity risk, inflation risk and sequence-of-returns risk.

A common theme emerged from the Boomertirement Industry Summit – there is hope for baby boomers, but they must take action now to secure their financial future. Dr. Greenspan called on boomers to take individual responsibility for their future – something I also state when addressing financial advisors, because our governments cannot and so will not provide for Canadians as we age. It is up to us – and our financial advisors – to plan and provide for our retirement years, be they spent in good health or chronic illness.

Karen’s note: This article can only begin to touch on the wealth of insight and information provided at the Summit. I will be including more of what I learned at the Boomertirement Industry Summit in upcoming advisor education presentations. Contact me for more information.