Now that the tax season has passed and the demands of the holidays are far behind us, we can take a moment to reflect on the blessings of Independence Day. As advisors, we have the opportunity to help our clients pursue their unalienable rights to life, liberty and the pursuit of happiness. Now, perhaps more than ever, is a perfect time to revisit your clients’ current financial plans to ensure they are focused on the right objectives for the future. Here are just a few ideas to help you initiate these discussions with your clients.
Hard times for boomers
The baby boomer generation currently faces financial challenges no generation has previously encountered, including pension terminations, unabated healthcare costs, growing uncertainty about government programs such as Medicare and Social Security combined with decreased personal savings rates in an era of increased life expectancy. These realities will call upon most boomers to significantly adjust their lifestyles to accommodate the possible loss of a job, healthcare coverage or personal savings.
Despite these ongoing challenges, with your wise counsel baby boomers can still find comfort and security as they plan for retirement. First and foremost we must convince clients to live below their means. This will leave them with income now to save for the future. Some of the most valuable elements of any strong financial plan are built on a foundation of life insurance and annuities.
A safe solution
Annuities deliver guaranteed income clients can’t outlive, while life insurance creates tax-free capital to assure that their debts and obligations will not outlive them. If the current downturn in the economy has taught us anything, it is that life insurance and annuities were built for times like these.
Life insurance provides clients’ heirs with the confidence and peace of mind that there will be dollars free of income-, capital gains- and, when properly structured, estate-tax, for their loved ones and beneficiaries. It is important for advisors to realize financial planning, especially during retirement is relative. Our current economic challenges affect all clients, regardless of their income or financial portfolio.
As challenging as it might be, it’s our duty to help our clients muster the confidence to believe the future is in their hands, not the government. Together we can help them build a lifetime of independence that our founders fought so valiantly for.