You’ve undoubtedly met these women before. They may play different roles — mother, aunt, grandmother, or a dear family friend — but they likely have much in common:
- They all moved straight from their parents’ house to their husbands’ house.
- Their husbands were the primary wage earners, and if the women worked at all it was just was just for some “pin” money.
- Many of these women have never made decisions about finances alone.
While not all women in the senior age bracket fit these circumstances, those who do have unique financial needs. In the “Father Knows Best” era of the mid-1950s, a woman relied on her husband for financial support. She happily changed her maiden name and let her husband take care of the finances while she stayed home with the children. However, she never imagined what would happen if her husband got sick and died and she was left making all the decisions for herself and her family.
Here is a true-life scenario that may sadly be repeated over the next two decades.
Sandy and Don were married for 34 years. Don owned his own business, and Sandy worked part time. She worked to keep busy, not to earn a significant living. Don always took care of their personal and business finances. Then, the unexpected happened. Don got sick and needed medical care. Sandy did not understand their health insurance policy. After a lengthy hospital stay, the doctors determined there was nothing they could do for Don and that he should consider hiring a nurse to help make his final weeks comfortable.
Sandy suddenly needed to deal with Don’s business and didn’t know where to begin. Don died, and while Sandy was unraveling the business issues, she was then faced with the medical bills — the insurance Don selected didn’t provide enough coverage, and Sandy had to pay his bills with credit cards. Sandy was in desperate need of an income, but without Don, there was no business. There was no key employee to run the business or an emergency succession plan. Additionally, Don did not have any life insurance. In the end, Sandy got two jobs to pay off the debts and had an attorney work out a payment plan with the creditors.
Life insurance could have provided much-needed liquidity at Don’s death. Long term care insurance could have provided some payment for the nurse. A business continuation plan, which is usually funded by insurance, may have provided additional income to the family and given Sandy a means to make money on the business.
It is unfortunate that no trusted advisor, whether it was a CPA, attorney, or insurance agent, reached out to Sandy while the business was running and Don was alive. By not developing a relationship with both parties, each of these advisors lost a valuable relationship when Don died. Sandy was not comfortable being strong armed with “we know better” tactics. She needed relationships based on compassion and trust. In the end, Sandy made poor decisions, she lost the business, and an insurance agent missed out on the opportunity to help Sandy get through this emotionally and financially trying time.
One successful tactic in this market is to create a niche marketing strategy. You market to grief counselors, church groups, and synagogues. You communicate that you like working with widows because you like to teach and empower them. And you should be of a certain disposition, as well, with a lot of patience and an affinity for watching these women learn that they can be independent at any age. Another marketing tactic is to have their portfolio on the ready so that at any given time, these women can call and ask, “Can I afford this?” They love being able to do that. It gives them a safety net. But take note: This all takes lots of time.
Building the relationship early on
So many times, mature couples do not keep their life insurance or even buy it once their children have grown. They simply think they do not need it. However, life insurance can provide liquidity and act as a safety net. Long term care insurance can help defray the high cost of lingering illnesses. And understanding the medical policy is essential.
This is a generation of responsible, thrifty, and reliable Americans. It is also a generation that is hard to convince of the need to spend money. The key here is to focus on the husband’s responsibility. They take care of their family and their wives. This generation typically saves for a rainy day. Do they want all they saved to go to their family or to be eaten up by medical bills and unexpected expenses? No one wants to think and plan for sickness and incapacity. However, lack of planning can lead to financial hardship for those who are left behind.
Building a relationship of trust
When advising aging couples or single women, take the time to help them see the holes in their current plans. Explain what type of policy they need and all of its benefits and its pitfalls. No policy is without drawbacks, and policies are difficult to understand. It is hard to know what to buy and what type of coverage to expect. As an advisor, explain what exactly is covered and what is excluded. Are there inexpensive riders available that make the coverage better? Can a bigger deductible make the coverage more affordable? Being truthful about pros and cons will allow you to be seen as trustworthy. You will not come across as someone who is more interested in making money than taking care of their customers. Integrity is important to this generation.
Everyone wants to spend their golden years with the ones they love or traveling and visiting friends. No one wants to spend all of their money on an unexpected disaster. And while you can never predict a client’s future, you can help them with products and advice to secure the happy retirement they worked their whole lives to achieve.
Rhonda A. Miller, owner of the Law Office of Rhonda A. Miller, is an estate planning and business entity planning attorney. She can be reached at firstname.lastname@example.org.