As advisors settle into a routine of social distancing, many find themselves facing the same challenges as their retired clients
Financial advisors usually start relationships with financial plans. Retirement is a major client goal. Together, a number is assigned, representing that goal. Investments are made. Progress is tracked. Hopefully the client hits that magic number when they retire. The checkered flag is waved. Retirement is about a lot more than having money to pay bills. Suddenly, that’s apparent as we shelter in place because of the Coronavirus.
You are working from home. There’s more time to the day than work tasks, considering there’s no time lost to commuting. You are stuck at home on weekends too. Congratulations! Now you know what retirement can be like for many clients.
Retirement – Fantasy vs. Reality
Many people grew up thinking about retirement like “The last day of the school term.” You run out the door, screaming for joy, not looking back. What would we do in retirement? Travel to exotic places. Raise horses. Sleep in. Do whatever you wanted. The world was your oyster. Unfortunately, this fantasy assumed generous defined benefit pension plans indexed for inflation and massive amounts of disposable income. Let’s be kind and assume “good health” is a given too.
The reality is many retired clients can pay their bills comfortably. They have some, but not much money for discretionary spending. They can take the occasional vacation, yet not spend their lives away from home, travelling to exotic locales. Put another way, they have discovered having fun costs money. There’s a burn factor. As a result, many wake up wondering “What am I going to do today?”
My grandfather, having retired to Fort Lauderdale, Florida long ago explained: “You have one activity each day. You spend the day building up to it, doing it and winding down from it. That activity might be getting your hair cut. If a friend suggested grocery shopping together, the answer would be: “Can’t do it. I’m getting my hair cut that day.” Some retired people stretch out activities to fill the empty time.
What Can Retired People (and you, stuck at home) Do with Their Time?
Retirees need activities that are mentally stimulating yet don’t cost a fortune to pursue.
Sports. Golf is a good example. You can play it on a public course. You can watch it on TV. If you follow favourite teams, you can attend home games or follow your team on TV. It’s a reason to get together with friends. During the lockdown, you aren’t playing any sports, but it’s likely you are watching games on TV. They might be rebroadcasts of classic matches.
Gym. Everyone agrees exercise slows the aging process. You can go the gym route or the exercise at home route. It becomes a daily activity. If you go to a gym, you likely make friends and see the same faces. It’s a social activity. While working from home you might be riding your Peloton. You are probably keeping in touch with your gym buddies by e-mail.
Garden projects. People who watch British murder mysteries think everyone in England has a spectacular garden requiring little or no maintenance. Wrong. It’s amazing the amount of work it takes to make something look effortless. You can hire people, but you can also do it on yourself. If you have outdoor space, you also have outdoor rooms for entertaining in the warmer months. With no gym for you to visit during “self-quarantine” you are likely substituting getting the outdoor furniture out of storage and set up.
Books. Yes, they can spend the day watching broadcast TV or cable channels. That gets boring and the volume of commercials can drive you nuts. Assuming they are readers, it makes sense to have favourite authors. You have the time to read their entire series. Another route for social interaction is to join or a form a book club with friends. Stuck at home, you’ve likely accessed books or your Kindle or Nook. You might have chosen one from a shelf and reread it. Were you given any books for Christmas?
Cooking. Statistics show people spend more buying food outside the home compared to what they carry in through the front door. It’s not just eating out in restaurants; it’s buying precooked means and warming them up before serving. You can save plenty of money buying foodstuffs on sale, keeping it in the deep freeze and preparing means at home. There are probably local cookery clubs of like-minded individuals nearby. You aren’t going out to restaurants because non-essential businesses are closed. You are likely cooking at home.
Entertaining. Your appreciation of cooking can lead to inviting people over for means at your home. It’s much less expensive than dining out. Social interaction around the table is preferable to phone calls because of the heightened engagement. You have people over. They have you over. It’s a virtuous circle. Staying home? If you haven’t discovered virtual cocktails with friends using Face Time or Zoom, get with the program. You are missing out on the latest cocktail craze, the “Quarantini.”
Hobby. You collect something. You are researching a book on local history. It’s a project. Although you might spend money “buying stuff” you spend far more time doing research. It becomes your specialist subject. You are considered a local expert. If you are working from home and have time on your hands, you’ve likely reawakened this interest, or at least rechecking prices based on what you’ve seen on “Antiques Roadshow.”
Consulting. You didn’t see leaving your job like “the last day of school” mentioned earlier. You enjoyed it enough to keep a level of involvement. You affiliate with a firm offering consulting services to your industry. Many retired clients are likely doing this already. You are still employed.
Volunteering. Retiring comfortably makes you one of the lucky ones. Many people don’t have enough to eat or are in difficult situations. You volunteer through your religious community or through an organization providing social services. You meet like- minded people. After organizing food storage at home, you’ve likely found lots of extra items you can drive over to the community food pantry, assuming they are accepting donations.
Keeping in touch. We’ve all heard “Out of sight, out of mind.” There are relatives and friends from “a past life” where it can be east to lose touch. Technology gives you several ways to reach out including phone calls, texts, social media, Face Time and Skype. Make it a point to reach out, even if everyone doesn’t return the gesture. You are likely using at home time to stay current on LinkedIn. Reach out to extended family members too.
Sheltering in place (staying at home) can get very boring, very quickly. So can retirement. Your short time coping with the pandemic can be an opportunity to learn some new ideas you can pass along to your retired clients.
Bryce Sanders is president of Perceptive Business Solutions Inc. He provides HNW client acquisition training for the financial services industry. His book, “Captivating the Wealthy Investor” can be found on Amazon.