One of the keys to selling investment products to senior citizens is recognizing that most of them live to some extent in a state of financial fear, said a sales training consultant at the Financial Institutions Insurance Association meeting here last month.
Larry Klein, president of NF Communications, Inc., Walnut Creek, Calif., pointed out that this is the reason that seniors are the best prospects for bank insurance agents.
For one thing, he said, “They want your advice.” And unlike many younger people, they generally trust the advice of professionals.
But above all, seniors are the hottest prospects for the simple reason that they have most of the money, Klein observed.
Not only have they had a longer period of time to accumulate their money than most people, but more importantly, they also control that money.
“The beauty about seniors is that their money is not locked up in a 401k,” Klein argued. “They can say yes and write you a check today.”
Yet with all of this going for seniors, those advisors and producers who dont take the time to understand them can chase them away.
“If you sell them the same way you sell younger people, theyll tell you theyll think about it,” he said. “But theyll never call you again.”
The first thing to remember about seniors, Klein insisted, is that they dont buy features or benefits. “They buy you,” he said.
They tend to pick an advisor or agent who seems to know what he or she is doing yet who doesnt make them feel foolish by talking about technical details that they dont understand.
Klein also pointed out a number of pitfalls to working with seniors, starting with their strong belief that their own experience trumps the facts.
“After youve been alive for seven decades, you begin to believe that what youve experienced is the absolute truth,” he said.
Advisors who are uninitiated in that aspect of dealing with seniors may present a financial solution that, while technically correct, runs into resistance because it is outside the seniors experience.
The senior may not express it in so many words, but the sensitive advisor can see when the client is losing interest in a subject. When you see the eyes glaze over, Klein advised, the senior has stopped listening. Its time to move on to some other topic.
Another important point, Klein noted, is that seniors want to be comfortable. To the smart advisor, that means avoid trying too hard to get them to invest in something that they explicitly say they dont like.
The fact that seniors tend to have a lot of time on their hands presents a couple of other hazards to the advisor.
For one thing, they dont always appreciate the time-management problems of the agent. When a senior telephones and leaves a message, they may expect the agent to get back to them in a few hours.
“The smart financial salesperson has an assistant who will advise clients that you always return your calls at the end of the day or first thing the next morning or whenever,” he advised. “Otherwise, you may not be getting the check you thought you were getting.”
Another aspect of having all that time on their hands is that seniors read a lot of newspapers, Klein pointed out. And they tend to believe what they read.
“Never mind that you have your MBA and few people in the U.S. know more about finance than you,” he advised. “And never mind that the guy writing for the paper is just repeating what someone else told him. Dont argue with newspapers.”
Klein observed, too, that seniors risk aversion means that they want whats proven. So advisors need to avoid emphasizing that a product is new.
“Seniors want to know 80 million people bought it, its tested and everything worked out great,” he explained.
The best way to avoid running into seniors hidden objections is to ask questions rather than telling them what you know, Klein added.
“Young salespeople love to use technical words,” he observed. “But seniors arent impressed by them. If you try to sell them something they dont understand, theyll feel foolish. Youre giving them one more reason to say, Ill think about it.”
Discussions about an annuitys surrender charges, for example, can frighten a senior away. So, rather than talk about those charges in technical terms, Klein suggests explaining in the simplest possible terms how much it would actually cost them if they tried to cash the investment in next year, say, instead of five years from now.
Finally, Klein stressed, act confident. Seniors can see through an advisors uncertainty very quickly. Gaining confidence means thorough training in all the products you sell, he concluded.
Reproduced from National Underwriter Life & Health/Financial Services Edition, May 6, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.