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The Barely Boomers

With all the attention focused on the retiring Boomers, it’s easy to forget there are plenty of Boomers still in their 40s.

By Helen Thompson

In January, the Baby Boomer generation’s oldest members started turning 60. Since then, the hue and cry has been over Boomers retiring. But for many Boomers, retirement is still more than 20 years away. A new study gives insight into this younger demographic, whose attitudes at times more closely mirror those of Generation-X than of Boomers.

The Barely Boomers: How They Will Impact Future Financial Services, released by the Spectrem Group in December, examines the differences within this demographic. Catherine S. McBreen, managing director of Spectrem Group, says the need for this study became clear to her when she realized that financial-services marketing for Boomers wasn’t targeted at her, but at her parents.

There are tremendous differences between those who came of age in the Nixon years and those who graduated in the Reagan era.

Think Reaganomics, not Vietnam
“They aren’t Boomers, but they’re just over the edge of being Boomers,” McBreen says. “I’m considered a Boomer, but I’m really in a different stage of my life. There are different needs that people have in different cycles of their lives regardless of whether they have passed a certain demographic cut-off point or not.”

Spectrem examined the attitudes and preferences among segments within the Boomer demographic, and several key differences emerged among those born between 1960 and 1965. We often talk about Boomers as one generation. But there are tremendous differences between those who came of age in the Nixon years and those who graduated from high school and college in the Reagan era.

For instance, Barely Boomers probably stand to inherit the worst of the Social Security crunch, but will benefit from watching their parents and older Boomers move through retirement. The warning klaxon that is going out to retiring Boomers is that they haven’t saved enough, but for younger Boomers, there is still time.

“For many people, this recent bear market was the first time they had ever had enough assets to have to worry about seeing them go down,” says McBreen. “They are dealing with it by turning to financial planners, in particular those who can offer more holistic advice: ‘Here are the tax implications; here’s the potential downside risk; and these are the things you need to think about. ’”

Market your expertise
Younger Boomers have grown up during a period in which information is a lot more accessible than in previous years. Older generations, McBreen explains, traditionally went to a broker because it was the only way to trade a security, but that’s no longer true. In addition, Boomers are notoriously independent. They don’t want their hands held for financial decisions but want a reliable contact point for when they do have questions. In other words, they already have information, and want your expertise.

“We don’t want somebody selecting a stock for us, so much as we want the depth of understanding why that selection was made,” says McBreen. “There are broader expectations that the advisor has more in-depth experience with that particular topic than the Barely Boomer or Generation-Xer can find on the internet.”

What’s the biggest indicator of how much the internet is shaping the future of financial services? Every person in the under-45 age group surveyed by Spectrem has internet access.

Building your business
How can you profit from this underserved market? According to Spectrem’s study, Barely Boomers are especially inclined to act on referrals from friends and family members. Also, they want advisors who can provide value-added services they can’t get on their own.

The decreasing segmentation of the financial-services industry is here to stay, and retirement will be less of a particular date and more of a lifestyle. The younger Boomers are going to be looking for estate planning, financial planning and long-term care insurance as they approach retirement. Advisors should be comfortable handling (or teaming up with experts in) all aspects of retirement planning to best meet the needs of these prospects.


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