Good Strategy For Today: Suggest A Financial Fresh Start

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Much space in recent issues of this magazine has been devoted to the needs and concerns of baby boomer clients as they save for their retirement.

Most likely youve had some of those very clients asking for your help in determining how to recover from the losses their retirement accounts have experienced in the last few years.

What can you do to help your clients make a financial fresh start? One thing you can do is direct their focus to the future, rather than the past, by encouraging them to make some specific financial goals. Setting financial goals certainly has more appeal than reviewing the financial setbacks of the past, especially the most recent past!

You might begin by reminding your clients that, even if they are only a few years away from retirement, their financial goals still include the long term. For example, a client who retires at age 55 could be in retirement for anywhere from 20 to 40 years!

Financial goal-setting takes the same approach as any other goal-setting activity: determine short-, intermediate-, and long-term goals. Then break those goals down into activities that can accomplish the goals.

Before you meet with your clients, have them write three lists for their six-month, three-year and long-term financial goals. (See the chart for an example.)

For instance, one client might have a six-month goal of reallocating his contributions in a variable annuity. He may want to diversify his holdings in a manner appropriate to the time he expects to need the money.

For a three-year goal, this client might list accumulating $6,000 by opening an individual retirement account. One of his long-term goals might be to purchase a retirement home.

Under each goal, your client would list activities that could be performed to help reach the goal. For example, regarding the IRA, the activities might include reading a book about IRAs, getting brochures from you about various funding vehicles for the IRA, revising the family budget to see where the money will come from to fund the IRA, getting the necessary forms, and writing a check to open the account.

For the goal of buying a retirement home, the activities might include researching the costs of homes in the clients preferred retirement location, taking trips to various possible retirement locations, and contributing to a deferred, fixed annuity to accumulate the down payment for the retirement home.

After your clients have determined their goals, you can suggest products that might help them to reach these goals.

At this point you might be asking yourself whether encouraging your clients to set specific financial goals is appropriate.

The answer to that is, more and more, customers expect a much broader range of services from agents who formerly “just” sold them financial products. So, although the above financial goal-setting activity doesnt put you in the position of being a financial planner, it does help your clients determine for themselves how best to use your services and the products you can make available to them.

While youre at it, you just might want to take the opportunity to make some new financial goals and get a fresh start for yourself!

, FLMI, AAPA, ACS, AIAA, AIRC, ARA, is a senior writer with LOMA in Atlanta, Ga, specializing in annuities and financial planning. She is co-author of the LOMA books Annuity Principles, and Products and Insurance Administration, 2nd edition. Her e-mail is: falk@loma.org.


Reproduced from National Underwriter Edition, February 3, 2003. Copyright 2003 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.