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Monthly Archives: June 2014

The Best Way for Advisors to Ensure Retirees Don’t Overspend

The Best Way for Advisors to Ensure Retirees Don't Overspend

Creating a spending plan for retirees is just the first step to ensuring they’re able to live the expected lifestyle without running out of money. Because people are living longer than ever before, it’s vital that individuals undertake more planning to avoid outliving their assets. Regardless of what plan an advisor may devise for clients, the advisor is going to need to play an active role in making sure people actually stick to it.


How Can Advisors Keep Retirees on the Right Track?


While clients are aware of what they’re supposed to do, that doesn’t mean they’re going to continue doing it. A great comparison is a trainer who gives a client a nutrition plan to follow. Although that plan may be the ideal fit for the client, if the trainer doesn’t check in on a regular basis and ensure the client isn’t cheating, chances are that person won’t end up losing much weight.


For advisors, the check-in process often happens on an annual basis. For advisors who are looking for a creative but effective way to connect with clients, one option to consider is a visual report card. To keep things engaging, this report can either have a green checkmark in areas where a client stayed within their budget, or a red X where they overspent. Depending on the specific plan a retiree is following, these visual ratings may be used for each month of the previous year, or in different sections of the budget.


Another advantage of communicating in a visual fashion is it can help remind clients of decisions they’ve made but may be quick to forget. For example, if a retiree decided to cut back on traveling so they can put money towards their grandchild’s education, reminding them of this decison can be worthwhile. By reinforcing that they are staying in line with the financial goals they made for themselves, this communication may be exactly the change of perspective a client needs so they will feel positive about their situation.


Help Clients By Creating a Buffer for Them


Regardless of their motivation or discipline, it’s almost guaranteed that there will still be times when a client wants to spend more than is currently allotted. Whether it’s an amazing trip opportunity or another form of entertainment, the temptation may be too much for a client to resist.


Since retirees should be able to enjoy life after working hard for so long, a discretionary spending account is ideal for these occasions. While it’s important to emphasize that this account is still coming out of overall wealth, knowing that these funds are available if a special occasion does arise is a great strategy for preventing clients from dipping into their portfolio.


By not only setting retirees up for success, but also providing ongoing support, financial advisors can reap benefits such as increased referrals that go along with happy clients.

Updating One’s Final Will: A Fresh Reason To Call


by John R. Ingrisano, CLU


Are your clients getting tired of getting the same, old, tired phone call from you every six months? Well, let’s change things up a bit. Rather than calling this month and saying, “Hey, I want to go over your coverage (or current positions),” how about this?


“I want to talk to you about what will happen when you die … and, no, this has nothing to do with life insurance. I want to talk about your will. So, let’s get together Monday at 11:00 a.m. for an early lunch. Or how about Wednesday after work?”


Talking points to cover in the meet ‘n eat:


1. Unfortunately, many Americans do not have a current, legally drafted last will and testament. (And scribbled notes on napkins or verbal expressions of intentions do not count. They can result in legal conflicts that can go on for years.)


2. A will gives you control over the estate that you have spent a lifetime accumulating — from cash, to real estate, to investments to precious family heirlooms, and more.


3. Your will helps keep peace and eliminate misunderstandings among family members. (“It says right here that Grandma’s ring goes to you; Lou gets the collection. Sounds fair to me.”)


4. Your will can reduce time and cost settling your estate. When there either is no will, it cannot be found, or it is out of date (with beneficiaries who are deceased or no longer in the family) your estate could become a legal and costly battle ground. .


5. Most of all, your will helps assure that your wishes are carried out. Written and properly witnessed, your will enables you can do pretty much what you want with your assets. It supersedes verbal instructions or casual, undocumented statements.


6. Nonetheless, the majority of American adults (65 percent) do not have wills. That means, by default, the court system will likely appoint an administrator … possibly an attorney who has no personal interest in the outcome of the family’s affairs. The administrator, who may receive a percentage of your assets as payment, might then be required by law to sell or distribute your possessions to settle the estate.


Recommendation: Encourage your client to contact his or her attorney today to update/draft a will. Oh, and then you walk away: No talk about coverage review or asset allocation changes; not today.


Then be sure to follow up in a week to set up a new appointment. That is when you can talk about how to fund the will.


The bottom line: Work hard, make money, have fun … and give away as much value-added information as you can. That’s just part of what makes us successful in this business. — JRI


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John Ingrisano is a licensed insurance agent, business journalist, sales trainer and “marketeer” who has developed sales programs, newsletters and marketing campaigns for dozens of major insurance and financial services companies over the last 35 years. He is also a public speaker and author of several books, including “The Back to Basics Book of Selling: A Guide to a Successful Sales Career” and “The Back to Basics Book of Money: A Couple’s Guide to Financial Peace.” John can be contacted by phone at (770) 314-2649 or by email at
Copyright © 2014 John R. Ingrisano