Ethnic Marketing–How Cultural Differences Affect Retirement Planning and Saving

Ethnic Marketing–How Cultural Differences Affect Retirement Planning and Saving

by Fabian Gonzalez

California’s financial professionals know, perhaps better than anyone, that the emerging opportunity to serve multicultural markets is significant. Sixteen percent of the nation is of Hispanic/Latino origin, but that percentage is more than double in California (38%), according to 2010 Census data.

Similarly, about 4.8% of the nation is identified as Asian. The challenge for California brokers is to serve these and other multicultural groups with the appropriate sensitivity, responsive approaches, and attractive products and services.

While there’s no single solution, a recent study may illuminate some of the nuances that brokers must navigate to serve the needs of multicultural groups. The comprehensive study, commissioned by the ING Retirement Research Institute, looks at the behaviors, attitudes, and readiness of various ethnic groups including Hispanics, Asians, and African-Americans regarding their future retirement.

The survey, titled “Retirement Revealed,” reaffirms what any financial professional already knows: Americans aren’t planning enough, saving enough, or getting enough professional advice to prepare for retirement regardless of their background or cultural heritage. The study also points to some important differences among ethnic groups, which may call for brokers to use some distinct strategies. Here are some highlights of the ING study:

Hispanics Feel Less Prepared

Hispanics feel the least prepared for retirement among the groups surveyed, with 54% saying that they feel “not very” or “not at all” prepared. But other groups are not far behind. That figure is about 50% of African-Americans, 48% of whites, and 44% of Asians.

Plan Balances Reflect Sense of Preparedness

Hispanic respondents also report the lowest average balances ($54,000) in their employer-sponsored retirement plans, which is in line with their feeling of not being prepared. This is considerably less than the average balance across all groups ($69,000). Furthermore, Asian respondents report having the highest average plan balances ($81,000) in their workplace plans, aligning with their better-than-average sense of how well they are prepared for retirement.

Barriers to Saving Are Not All the Same

About 73% of survey respondents say they have encountered barriers to saving, but the barriers are different among the groups. The biggest barrier to saving, for nearly all groups, is not having enough income. Hispanics and Asians are more likely than whites and African-Americans to say they need to know more about their savings options while African-Americans are more likely to say that debt is their biggest barrier.

Self-Education Is More Common

Non-white respondents are more likely to get investment guidance or information from the media or Internet. Hispanics (50%), Asians (53%), and African-Americans (54%) say their primary source of information is the Internet or the media compared to 45% of white respondents. Thirty-one percent of whites say they are working with a financial professional. This is significantly more than Hispanics (19%), African Americans (20%) or Asians (22%). Yet, all segments of respondents rank face-to-face communication with a financial professional as offering the highest value in providing information about their retirement plan and other employee benefits.

Estate Planning And Life Insurance Differences

Estate planning is another area of opportunity for financial professionals who are working with multicultural audiences. While Asians have the strongest savings, they are the least likely to have a last will and testament (26%) compared to 31% of Hispanics and 37% of whites. Life insurance ownership is much stronger among African Americans, with more than 95% owning some life insurance and 23% having life insurance coverage that equals four to five times their salary, which is higher than the total population of respondents (18%). African-Americans are also more likely to leave life insurance proceeds to their heirs. About 70% of African-Americans plan to leave life insurance proceeds compared to 51% of whites, 55% of Hispanics and 44% of Asians.

The study has important implications for financial professionals, particularly those in California. The first is that many Hispanics, Asians, and African-Americans who are not planning, saving, or preparing enough for retirement can be helped significantly by getting advice from financial professionals. The second implication is that brokers must take active steps to formulate culturally competent marketing strategies to engage and serve these diverse groups and their families.

Leveraging Carrier Expertise

Few brokers have the resources to launch a multifaceted campaign to serve multicultural groups. Even if they do, the stakes are high for making such an investment and the risks are daunting. Missteps can include everything from mistranslating text to using brochure photos of Hawaiians to sell to Chinese, which can alienate the very audiences they’re trying to engage.

For this reason, brokers are looking to carriers for guidance and assistance with multicultural marketing. Due to their economies of scale and national or even global experience, insurers may provide in-culture and in-language customer service support as well. A handful of carriers also can give financial professionals the strategies and online resources to help them make multicultural marketing an integral part of their business plans.

With such integrated strategies and the cultural knowledge to make them work, California brokers will be prepared to transform the rising multicultural tide into strong momentum for growth in the years to come. q


Fabian Gonzalez is vice president of Multicultural Sales for ING U.S. Insurance Sales Support, where he creates multicultural sales opportunities within ING’s individual life insurance, annuity, and employee benefits businesses. Gonzalez has more than 20 years of insurance experience in the U.S. and South America. You can contact him at For more information about the ING Retirement Research Institute, go to


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