A vast amount of psychological research shows that graying adults–those from the mid-40s on–make decisions (including the decision to do nothing) on a different basis than younger individuals.

The latter rely mainly on analysis based on the facts as they see them and what they consider to be logical reasoning. Older adults rely mainly on their experience in life. The fundamental problem confronting graying insurance and investment clients today is that their experience does not appear relevant in the present crisis and, therefore, they have no basis on which to make financial decisions.

But in fact, graying clients do have life experience that is highly relevant to today’s insurance and investments decisions. They need to be reminded of it. Here are suggestions on how advisors can talk to these clients so the clients can use their own experience to put things in perspective:

“I know things are uncertain now. Like everyone else I’m a little afraid, too, but when I begin to get upset I remind myself of history. First, in the depths of the Great Depression when unemployment reached 25%, Franklin D. Roosevelt said something that is remembered to this day: ‘The only thing we have to fear is fear itself.’

“Things today are nowhere near as bad. America is stronger in every way; so is the economy. If we got through that, we’ll get through this. If your father or grandfather had been able to invest in the broad stock market then, he would eventually have made a huge amount of money and you probably would be wealthier, too.

“Second, at the beginning of World War II in 1941, we had a very small army and after Pearl Harbor, a very beaten up Navy. Japan and Nazi Germany were far stronger than our present enemies and the United States and its allies were much weaker than we are today. Yet in just 4 years we won that war and put the world on the path to freedom and prosperity.

“If your father had been able to invest in the broad stock market then, you would probably be much wealthier today because both the U.S. economy and the stock market grew explosively during and after the war. For the record, the S&P 500 lost 11.6% in 1941 and then had 4 straight years of double-digit gains before losing 8.1% in 1946, the year after the war ended. It did not have another losing year until 1957.

“Third, after World War II, we had the Cold War. The Soviet Union was the greatest threat we ever faced because it had the nuclear capability to destroy this country. It was a vastly more dangerous opponent than present enemies. Remember, the Cold War went on for over 40 years, yet, despite the danger and huge sums of money the U.S. spent for defense, the economy grew and grew and so did the stock market–and we won that war, too.

“From 1949, when the full threat of the Soviet Union was recognized and North Atlantic Treaty Organization was founded to defend the Free World, through 1990 when it became clear the Cold War was over, the S&P 500 averaged a return of 12.2% compounded annually .

“Compared to those very enormous dangers, today’s fears really don’t seem like much, do they? The economy will recover and start growing again. Based on history, the stock market will eventually follow the economy up. Then, those who are able to overcome their fears and look to the future will be better off than those who wait until there is no danger. During the Cold War, the danger didn’t end for 45 years but the economy and the stock market both kept growing anyway.”

At this point, some graying investors might say “this time it is different.” Again, remind them of what they already know from their life experience, that:

1) Every major crisis is different. The Cuban Missile Crisis was different and much more threatening; the U.S. teetered on the brink of nuclear war for 3 weeks. The Energy Crisis was different and much more damaging to a much weaker economy.

2) The real question is not whether today’s crisis is different but rather, what happens as it is resolved and afterwards? Experience shows that people adapt to the most difficult circumstances and keep going; think of the British during the German bombing attacks in World War II. Life goes on and so does the economy. Based on history, so does the stock market.

Don’t expect graying clients to agree and immediately jump back into the market or variable insurance purchases. They’ve just heard a different perspective and a way to make their life experience relevant. Next they’ll need to connect their financial decisions to what’s important in their lives–life issues that range from what to do in retirement to how to enjoy the grandchildren. Advisors and reps who make those connections clear for graying clients will see those clients once again step into the markets and variable insurance.

Michael P. Sullivan is president of 50-Plus Communications Consulting, Charlotte, N.C. His email address is Mps50plus@aol.com