Baby Boomers represent more than 22% of the UK population or about 14.2 million people in total. They have money, but they also have problems and don’t know where to turn for advice.
If your accounting practice has consulting services on offer, you are well positioned to help them.
Who are the Baby Boomers?
Having looked at what Gen X clients worry about, this older population segment needs no introduction. Born between 1945 and 1965, they are in their early 50s to 70s today. This single market segment controls 80% of the UK’s total £6.7tn of wealth. If the nation has £2.6tn in investments and savings, Boomers own £1tn themselves. Euromonitor forecasts the global spending power of Baby Boomers will reach £9.6tn by 2020. Since they often make buying decisions based on referrals, that’s great news if your current clients are satisfied with your services. You are familiar with this audience. They are likely your clients. You might be one yourself. If not, your parents are likely Baby Boomers.
What do baby boomers worry about?
Your Boomer clients likely talk with you about financial matters. Retirement is an obvious example. They have problems in other areas. They don’t know where to turn for advice. You are well positioned to help, yet they often don’t see you in that context.
Here are some examples:
Caring for aging parents - If boomers are 50-70, their parents are 70-90-plus. 75% of Britons aged 65-plus own their own homes. As those parents age, it becomes harder to live independently in older houses. According to the 2001 Census, about six million are unpaid caregivers. Boomers are worried their parents will need to move in with them while the parents are fearful of losing their independence or going into an old folks home. Waiting for God, the BBC 1 comedy set in a retirement home ran four seasons in the 1990s.
How can you help? Britons aged 65-plus own 40% of the £2.5tn property market. The Boomers prefer their parents not move in while the parents want to pass the house to their children. Perhaps you can get the two generations talking. Would the parents consider downsizing to a 55-plus retirement community? The UK has plenty, often with the ability to transition into specialised medical care if health problems develop. The sale of property likely frees up cash which can be used for funding grandchildren’s educations, charitable giving or foreign travel.
- Providing for a disabled or special needs child - In 2016 the UK had 1,228,785 children with special educational needs. One out of 20 under the age of 16 is disabled. It costs three times as much to raise a disabled child versus a child without disabilities. Their Boomer parents have taken this responsibility very seriously, but they are getting older. They are concerned who will provide the care their child needs when they are no longer around.
How can you help? The state provides some support, yet it’s likely means tested or for specific types of help such as rent supplements or transportation assistance. Suggesting establishing and funding a special needs trust may give Boomer parents peace of mind and the cost of care will be covered when they can’t deliver care personally. You would likely work in tandem with a legal team to help them establish the trust.
- Providing for their own retirement - The Telegraph reported in 2013 ‘Brits Worst in World at Saving for Retirement’. The article quoted an HSBC study showing the average retirement lasting about 19 years, yet the average person’s retirement savings will run out after seven years. Here’s another way of looking at it: About half of Britons over 35 buy at least one lottery ticket a month.
How can you help? This is a financial planning scenario. You can help clients analyse their situation. Using Monte Carlo analysis to determine how their portfolio would perform under different stock market scenarios. The analysis doesn’t say they will reach their goal. It assigns probabilities instead. This establishes an issue that could be addressed by working longer, taking less income in retirement or saving more prior to retiring. Often the people having this discussion with them are selling product. You are selling advice. They can implement your suggestions wherever they choose, or you can provide multiple providers for them to interview.
Baby Boomers face serious issues. Often they don’t know where to turn for advice. You are in the accounting profession, yet you may also be in the advice or consulting business. Do your clients know how you can help? It’s their choice to determine if they will take the next step.
About Bryce Sanders
Bryce Sanders is president of Perceptive Business Solutions Inc. in New Hope, Pennsylvania.