Selling to Seniors: Trust First, Sales Second

Before dealing with older life insurance buyers, producers need to know the profile

Harry was able to secure an appointment with a mature couple who wanted to know more about protecting their assets. After chatting for a few minutes, the husband held up the mailer that created the meeting in the first place and blurted out, “What is this about?”

Harry proceeded to explain that with- out a good trust, the government would take most of the couple’s assets through probate and the lawyers would get the rest. The prospect kept asking questions and Harry kept answering. When Harry tried to close on the prospect, the prospect talked to an attorney partner who did trusts and said he would think about it.

Have you experienced this kind of scenario? Do you sense that prospects some- times seem suspicious and unwilling to take the next step? Would you like to create an edge in increasing your closing ratio? Read on and discover what seniors really want, what worries them most and how they think.

What Seniors Really Want

A recent Forrester research study revealed that your senior clients want three things from your relationship:

1. To understand what they are buying.

2. Someone to be in control of their investments rather than feeling on their own.

3. Frequency of contact.

This means that if you haven’t kept in contact with your senior clients over the past three months, you’ll be unable to gain referrals and more of their assets. According to a McKenzie consulting study, 50 percent of seniors are considering changing their financial advisor. The conclusion is that you need to verbally keep in contact with the clients you want to keep at least every three months.

As you make these three-month phone calls, remember that seniors are most worried about five things in their financial life:

1. Running out of money before running out of life.

2. Probate or the government getting their money instead of their heirs.

3. Market and investment volatility.

4. Inflation.

5. Taxes in retirement.

The more you address these worries, the more loyal your clients will be. This makes sense when you consider that empty nesters and mature adult couples, age 55 or older, have more than triple the investable assets of any other demographic group. It is also shocking that, according to Harvard studies, the average American household has only accumulated $29,000 for retirement. While many experts say that in order to live at 80 percent of their pre-retirement lifestyle, they will need 10 to 14 times their annual income in retirement investments.  And it is your duty to help them through that swamp of insecurity and uncertainty.

Gaining Referrals From Seniors

Top producers like Rick Martin, CSA, contact their senior clients every three months. They employ a technique called “Catch up, Update and Referral.” 

Catch Up. Make sure the senior feels confident that you care about them and their retirement. Discuss their grandkids, hobbies and recent travel. 

Update. Revisit with them on their insurance products and the economy. Talk about investments (if you are properly licensed). Let them know about macroeconomic events like why gas prices are going up and why real estate prices may be slowing. Review what has happened over the past three months, what will happen over the next three months and get them to discuss their worries and fears.  Just because they are senior citizens doesn‘t mean they aren’t interested and curious. Also, look for new money. Ask if there have been any changes in their financial life in the last three months. You should be able to find new assets at least 25 percent of the time. 

Referral. This is an important stage.  If you keep in contact with your senior clients every three months, you will gain referrals on every call. Referrals are given when clients receive value from your relationship. Value doesn’t just mean high returns. It also means a sense of commitment that you care and are working for them. First, tell them what you have accomplished in the last year and be specific—“So far this year, your assets have increased 12 percent with virtually no risk. We were also able to save $6,000 in taxes.” Then, get them to confirm the value. “How are we doing for you so far?”  When they say “great,” ask for the referral.  “Who do you know who could benefit from the kind of relationship we have had so far?” You should plan on getting two referrals from every request. In one study, 70 percent of seniors said their financial advisor relationship was the result of a recommendation of either family or friends. If you can’t get at least two referrals per client, you need some work.

What Seniors Value

This mature generation is defined by World War II, the Great Depression, stock market crashes and FDR’s funeral.  A senior’s mindset is one of self-sacrifice for their kids and grandkids if necessary.  They have respect for government and authority. They are also characterized by a sense of thrift and frugality that often borders on caution. Seniors’ favorite hobbies are gardening, traveling and spending time with their grandkids.

Pre-retiree baby boomers are suspicious of government and are defined by Vietnam, a sense of entitlement to prosperity, an expectation of constant investment returns and the assassination of JFK.  Pre-retiree boomers are to a great degree narcissistic and focused on themselves so much they will continue in retirement to explore their inner self.

They distrust authority—especially the government. Often, their goals are to control stress, simplify their life and look for short cuts to investment returns without spending time to do the hard work. Pre-retiree boomers are focused on fitness, psychological expression (a.k.a. finding themselves) and planning for the kind of life they want during retirement.

Now that you have a better idea of how they think, you will want to know how to communicate to make them more comfortable in your relationship. Here are five tips to help close more sales with senior and pre-retirees:

1. Turn up the heat a little because they tend to be cold more often.

2. Get rid of yellow in your letterhead, office and especially notepads since this will irritate the retina of a 55+ adult.

3. Print any materials you give them in at least a 16-18 point text that will be easier for them to read.

4. Offer cookies and coffee to set them at ease.

5. Speak louder and slower to make sure they comprehend the message.

Selling to seniors is all about relationships, rapport and trust. If you see them based on a referral, your sales will occur 35 percent faster. On a cold call basis, they will at first be suspicious. If you have to see them without a referral, just focus on asking questions during the first meeting. Xerox research has shown that if you can uncover one need, a sale will occur 36 percent of the time; two needs equals 56 percent; and three or more needs will set the stage for a sale 100 percent of the time.  If you use these techniques, your success with selling to seniors will soar—and they will be your clients for life. 

By Kerry Johnson, MBA, Ph.D. for InsuranceNewsNet Magazine. Kerry is a best-selling author and frequent speaker at financial planning and insurance conferences around the world.

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