Tomorrow will end National Retirement Planning Week, in case you didn’t know. The event is supposed to get consumers from the, “Yeah, I should start thinking about retirement,” to “Let’s see an advisor and get a plan together” stage.
A noble effort spearheaded by the Insured Retirement Institute and other advocacy groups, no one can argue that we all need to think ahead and plan for how we are going to pay for our lives after we leave the workforce and take off for the golf course, travel to exotic places or just plain watch the grass grow.
In the interest of full disclosure, I include myself in the category of those who have yet to get off their couch and actually start a retirement plan. Like many, I contribute to my 401(k), have mutual funds in my bank and an IRA (which was funded by a 401(k) I accumulated from a previous job). Have I met with an advisor? No. As I half-jokingly tell friends and family, my retirement plan is to marry a rich old guy. But I know that is not a realistic plan. (Hey, maybe it could be.)
Yet I sometimes wonder if the problem lies partly with the industry and not just the public. Is the insurance and annuity industry soft-selling the need to formulate a plan for our Golden Years?
We’ve all seen the commercials from the major financial services companies. Most include an earnest-looking business person saying how they can get your financial house in order. Or they ask people to place a blue dot for the age of the longest-lived person they know. All well and good, but they do seem a bit, well, bland and oblique to me. Do most people understand what is really being talked about, or what is at stake?
Compare those to the commercials for car and homeowners insurance. There’s that funny Gecko character. (Why does he have a British accent?) Or the “Mayhem” guy from Allstate who crashes through roofs and car windows to show how your home or car can be destroyed in a blink and why you need insurance. Those ads are funny, but they also make their point in a very concrete (maybe too concrete), understandable way.
Perhaps people need to be pounded a bit harder on the importance of having the funds to carry them comfortably through retirement. Maybe the point should be: “If you don’t start planning now, you will end up old and broke.” I can see you cringe at that harsh sentiment, but isn’t that what we are talking about? Yet, I know, not even Don Draper could make that ad palatable to the companies or one that wouldn’t make most Americans run to the nearest window ledge in fear for their future.
Do we need overt scare tactics? Maybe, considering how most baby boomers themselves admit they are woefully short of funds for retirement. But what about the cohorts after the boomers? At least a portion of boomers have company-sponsored pensions. Gen X will be the first generation of workers without the safety net of a pension. They are going to need products like annuities to provide a guaranteed income in retirement. They need to know those products are available and, possibly, with marketing that is more forceful in that message.
I don’t know what the answer is. I don’t work in advertising or marketing. But maybe it is time to move beyond the soft sell. Because not everyone is going to hit the lottery or marry a rich old guy and will need another retirement roadmap.
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