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November 17, 2004 at 07:00 PM
Getting Boomers To Face Their Own Mortality
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“Boomers seem to feel good once its over,” says Kathy Hamm, a financial advisor with Lincoln Financial Advisors, Cincinnati.
She is referring to boomers completing a comprehensive financial planand particularly, the piece having to do with their own death.
A lot of boomers would rather talk about any financial planning topic than their estate plan and their death, explains Hamm.
How to move the dial to that sensitive area? First, say financial professionals, it is important to recognize that there is often resistance to discussing ones own death.
Boomers tend to be very good at making excuses about why they are putting off this kind of planning, explains Dwight Moldenhauer, owner of Moldenhauer Advisory services, Buffalo, N.Y. “Some male boomers will say, Well, my wife wont need that [life insurance or whatever]. She has a job and the mortgage is taken care of if I die.” Yet, when Moldenhauer looks into the existing finances, he says he often finds that their planning greatly lags behind their actual situation. For example, clients may still have the same amount of life insurance they carried when just entering the work force, even though they are now managers, executives and business owners, he says.
It can be discouraging, he adds. “Some of the boomers seem almost entirely focused on their individual needs, not on the needs of their dependents and survivors.”
It is the job of the agent to help boomer clients see what they need to do, Moldenhauer contends, adding “the computer models they can use on the Internet are not going to do it for them.”
Hamm agrees. “Dont shy away from the subject. Rather, make it part of the comprehensive plan.” For example, the advisor should bring it up by asking, Where does your estate plan stand currently?
She often starts by asking simply, “Where are the documents, the will, the trust and so on?” Often these documents are way down on the boomers To-Do list, Hamm says. “They will say, Im too busy. I havent gotten to it yet.”
But, if the boomers have children, they really need to have these documents, Hamm says. To help them see that, she asks things such as, “Who will handle the money for the kids if you die?” And, “What about your spouse if he or she is still alive then?”
If the boomers decide they want to have these documents, she offers to put things in motion. For instance, if the clients dont have their own attorney, she offers referrals.
And, she says, “I set up the first meeting with the attorney and have everyone come to my office to discuss what is needed.
Then, when the documents are ready for signing, I go to the attorneys office with the clients. That way, I know that everything has been taken care of and what else needs to be done, such as re-titling assets, changing beneficiaries, etc.,” Hamm says.
All this work with documents becomes the door-opener to discussing the other issues that surround mortality.
For example, Hamm says, “well start talking about additional survivor needs for cash flow, and see if there is additional need for life insurance and disability insurance.” Long term care insurance tends to come later.
These discussions progress naturally to reviewing needs, product types, costs, pros, consand death. “You have to bring that up,” she stresses. “You have to look at what the problems and circumstances are going to be if the client dies.”
Daniel Veto, chief marketing officer, Bankers Life and Casualty Company, Chicago, believes that the advisor sometimes has to “provoke” boomers into thinking about their own death.
There are certain ages in life that are milestones, he explains. They are ages 16, allowed to drive; 18, allowed to vote; 21, allowed to drink alcohol; 40, mid-life crisis; and 65, move into retirement. After that last milestone, Veto says, “many people feel they are on their own, and they do start to confront their own mortality.”
