Steve Gresham
Steve Gresham
NEXT CHAPTER
retirement center in Florida . My mother hated the idea . My father was relieved . My siblings had mixed feelings . But we did the deal — which gave them a care annuity allowing for their transition from independent living to assisted living to nursing care , even hospice and memory care facilities . They would not occupy these until they had to . Mom was clear on that point . And that was 2015 .
Fate Makes Tough Decisions For You
In the fall of 2016 , my father received a pancreatic cancer diagnosis . At age 83 , he knew he had no choice but to accept
Here ’ s where reality meets data : The people leaving their money are standing in the way of the great wealth transfer by living longer .
his condition and seek comfort , and the solution was the continuous care center , although he had to take it up sooner than anyone had anticipated . Unexpected health events are what we at the Alliance for Lifetime Income call “ the moments that matter ”— things that force families to take action whether or not they are ready .
My dad moved directly to the center ’ s nursing facility ( and never left ). With a rapidly growing elderly population , seats in these places are becoming more dear . My colleague , Tom West of Signature Estate & Investment Advisors , calls this the “ game of musical chairs .” If you haven ’ t made a reservation , you might not have a seat when the music stops . Then what ?
Don ’ t Wait For The Money
Every advisor has heard the big numbers associated with the “ Great Wealth Transfer .” Statistics from Tiburon Strategic Advisors say $ 49 trillion of baby boomer and Silent Generation assets will flow toward Gen X and millennials .
But here ’ s where reality meets data : The people leaving their money are standing in the way of this transfer by living longer . My mother is the first in her family to reach 90 . She won ’ t be the last . She gives generously to charity but holds on to most of the rest . “ You need to be prepared ,” she says . Her modest investable assets won ’ t be an opportunity for anybody until they are . She ’ s in good health — and in no rush .
Many advisors I know roll their eyes about the supposed bonanza — which
seems very far away . The older generation still needs that money for all sorts of things they haven ’ t planned for , including possible health challenges . They ’ ll be dealing with variable healthcare costs . And meanwhile they want to age in place . They might still divorce … or succumb to financial fraud . These are all trends among aging Americans , of whom there are a record number .
So don ’ t wait for the money . Instead , lean in to conversations . Probe for reactions when you ask your clients what would happen if they ran into trouble . “ What would you do if your mom needed full-time care ?” “ What is your plan for where you will live if you aren ’ t able to live safely in your home — alone ?” That ’ s the real opportunity for you to be part of this “ wealth transfer ”— to be involved in the conversations that matter about the moments that matter .
Gen 2 Is Our New Engagement Partner My mother does not talk to advisors
( she never liked it ). She talks to me .
Remember Bonnie , whom we discussed at the beginning of the article ? She and Bryce asked me to be Bryce ’ s executor after firing “ Jerry .” Their daughter Sarah is one of their four Gen X children . Bryce has faced health challenges , something the kids are aware of , and the family is concerned about his ability to live safely in his longtime home .
Their problems are a microcosm of the bigger issues : While the first generation continues to own its assets , the second generation is very much engaged with the forward use of those assets . And if advisors aren ’ t connected with Gen 2 now , each critical moment offers us an opportunity to make that connection .
Yet industry surveys continue to show that most advisors don ’ t actively engage client families . Ask yourself this question ( posed by a longtime advisor friend of mine ): Can you name the spouse and the children of your top 20 clients without looking at the files ? If you have more than 20 clients , like most advisors , there is work to do with the rest , too . It ’ s worth the effort .
As a final thought , try this list of todos for growing your business with your existing client families in 2024 : 1 . Sort your clients by age . 2 . Meet your clients ’ spouses and partners — for the benefit of all .
Include in those meetings the family questions : Who will take care of whom ? And when ? And how ?
Here ’ s another list of to-dos to keep in mind :
1 . Commit to one family meeting with each of your oldest clients this year .
2 . Work your way down your client list — chronologically .
STEVE GRESHAM is managing principal of Next Chapter , a leadership firm dedicated to the next chapter of financial services — ensuring the financial and retirement security of all Americans . He serves as senior education advisor to the Alliance for Lifetime Income . He was formerly the executive vice president and head of the private client group at Fidelity Investments .
28 | FINANCIAL ADVISOR MAGAZINE | MAY 2024 WWW . FA-MAG . COM