MDRT Study Sheds Light On Connecting With Generation X
Copyright: | unknown |
Source: | Proquest LLC |
Wordcount: | 1239 |
While a recent MDRT study shows that Gen Xers are ready to create retirement plans, they differ from the baby boomer generation in the way they want to learn about and discuss those financial matters. Understanding those differences can help you gain more clients in this age group. By
During this never-ending "Great Recession," there has been a lot of attention and focus on the nation's largest, wealthiest and most influential demographic group, baby boomers. Those 76 million consumers are between the ages of 46 and 64 in 2010 and are greatly impacted by the liming and duration of this particular economic downturn.
But another generational cohort, Generation X, is equally as large now, thanks to immigration, and they are also greatly impacted by what's happening with their money, savings, incomes and longer temi plans.
To gain insight into how Gen Xers, between the ages of 29 and 45 in 2010, are thinking, feeling and acting when it comes to their money, we partnered with the
A key finding in the study was that Generation Xers are indeed ready, willing and abJe to talk with financial services professionals about their financial situation. Some 44% said that a direct result of the current economic downturn is that they now think it is important or very important for them to have a financial plan. Their eyes are open now. More importantly. 74% agreed that a financial plan is a priority for them.
This positive attitude about financial plans is good news for those agents and advisors who think' that younger adult. s do not yet have a planning mentality. In fact, almost all Gen Xers agree that having a plan is important, no matter the economy. But the opportunity exists where only 41% express a degree of confidence in their current plan. They need help.
Retirement plan vs. financial plan
The MDRT siudy also uncovered a key hurdle that advisors and agents must overcome in order to better connect with today's Gen X financial consumer: You need to make sure you are speaking the right language to the right generation.
One might think that when it comes to money and financial matters, there is a universal language. Not today, there isn't. Older generations use their own terms and expressions, which differ from the words more often used by younger generations like Gen Xers. Speaking the same language as your client is one easy way to deepen the connection.
A key example is using the term "retirement plan" vs. "financial plan." In a 2009 study among MDRT members and other financial services organizations, those who are more successful (more assets under management) told us they use the term "financial plan" more often. As one advisor told us in the research, "1 tell all my clients that a retirement plan is part of an overall financial plan, but the opposite is not the ease."
While logical, such an approach may not be very effective based on what Gen X consumers told LIS in the MDRT Generational Financial Confidence Study. In fact, one out of three Gen X consumers in our survey said they prefer the term "retirement plan" when thinking about planning their money for the fu t LI re. It seems that until a consumer reaches traditional retirement age. Lili financia! planning is about "retirement planning."
Or, perhaps younger Gen Xers do not yet believe they have accumulated enough money to need a "financial plan," but do know they will require a "retirement plan."
As one Gen X consumer said. "1 like this term [retirement] better because I see myself as working towards having the retirement I want, by saving now." The bottom line is that words matter. Use the terms that mean more to your Gen X clients.
One caution aboLit "retirement." though. For two out of three Gen Xcrs, it doesn't come with a specific age in mind. They simply say they "don't know" when they will retire. Even their official qualification age for maximum
Do-it yourselfers
Also in the MDRT study, we asked Gen X consumers to identify what thev really wanted from advisors or agents helping them manage their money. We asked consumers to write in responses, so they would use their own langLiage and terms. What we learned was fascinating.
Generation X said, "help me make money." Both of the key aspects to this response: "help me" (don't do it for me. iList help me do it) and "make money" (instead of manage, save, grow or any other verb), are important.
Older generations, like boomers and the Silent Generation, use other words to convey the role they want from their advisor. Rather than "make money," older generations talked about managing their "investments." They use the term "finances" and "financial" instead of "money."
The "help me" aspect of Generation X is consistent with what we have seen and learned in other research studies. This is an independent, task-driven, self- ve liant generation. In fact, in our study, four out of IU Gen Xers said the economic meltdown has caused them to "become more do-it-yourselfers."
This generational trait of running their own lives shows how Gen Xers learn about financial services and producís. They do their own homework, typically online. You need to know that your 30- and 40-someihing-year-old clients are using the interne! to conduct more financial activities than any other generation. Be there to help them, and realize they will come back to you with their assessment of what they should or should not do.
That means VOLI have to provide them with the tools and information for them to do their own research on any financial product or service you are trying to sell them. Point them to resources online - ideally your company's Web site or other resources you have found first - rather than wait for them to find information on their own (which they will). The opinions are but a click away, so you should at least attempt to start them in the right places.
You might do some surfing yourself, using keywords to see what they might be seeing. Read the blogs and comments online about your firm, your products or the products you sell. Your Gen X clients will find those postings, so you should know what's there, too.
Connecting with Generation X is not difficult if you master the lingo and understand how they will Lise the tools available to check your recommendations. Once known as the "lost generation." you'll succeed with them by pointing out the way.
"You need to make sure you are speaking the right language to the right generation "
"... your 30- and 40-something-yearold clients are using the Internet to conduct more financial activities than any other generation. Be there to help them, and realize they will come back to you with their assessment of what they should or should not do "
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