Financial advisors need to learn about grief because they deal with life transitions all the time. Think about it - the births, the marriages, the retirements, the deaths. Research tells us that three-fourths of referrals come when people experience these life transition events.
All of these events put money in motion but the biggest one is death. Right now, baby boomers control $2.1 trillion worth of wealth. In the next 40 years, $41 trillion worth of wealth will change generational hands as people die and pass it on, and every financial advisor wants a piece of that. The problem is that all of these transitions also trigger grief. So, when people come to a financial advisor in grief, they want the financial advisor to invest their money, but they want more than that. They want somebody who understands them, who cares about more than just their money; somebody who knows what to say, how to act, how to support them. If they can find a financial advisor like that, that’s who they are going give their business to. The problem is most financial advisors don’t know. They don’t know what to say, what to do, how to act. What do you say when a widow in your office breaks down in tears? What do you say? What do you do? How do you support her?
We don’t know that as a society. It is often said there are three big taboos – sex, money and death. I don’t think so. We talk about sex all the time. An updated version of The Joy of Sex was recently published and is flying off the shelves. We’ve got Dr. Ruth Westheimer and sex gurus. Sex is everywhere. We’ve got money everywhere - Suze Orman, Cramer. We’ve got all kinds of money talk, money shows, money everywhere. Death? Grief? Where’s the guru that teaches us how to deal with our grief? Where’s the guru that says, “What do you say at a wake? What are the good things to say? What are bad things to say? How do you handle your grief? How long does grief take? How do you get through it?” It doesn’t exist.
So, in general, clients and professionals alike don’t know how to deal with grief. They don’t know what to say. They don’t know what to do. And, consequently, as a financial service professional, if you do – if you do know what to say, what to do, how to act around a grieving person, you become the go-to person. You are going to get the business. You are going to, as I say, meet your boom in the coming death boom.
The coming death boom. The reality is our population’s aging. Right now, as you walk down the street, one in every nine people you pass is 65 or older. And almost a million of them are millionaires. After that age group are the baby boomers, those born between 1946 and 1964. I’m in that group; I admit it. And we’re aging. The older baby boomers are in their ‘60’s now, starting to get Social Security. Right now, every 49 and a half seconds in the United States, a baby boomer dies. There were 78 million baby boomers born; 75 million baby boomers now. We are dying. Our parents are dying. Our spouses are dying. We are starting to die and all of that wealth is going to change hands.
Like it or not, just as we had a baby boom between 1946 and 1964, we are in for a death boom now. The rate is only going increase. If you look at the age charts, it looks like the pig moving through the python. As that death rate increases, the advisors who are going to succeed are the advisors who know how to deal with people in their grief. There’s going to be a greater concentration of deaths in the next 20 years than we’ve had in a very, very long time.
People are very shocked when they realize the percentage of widows who do not stay with their financial advisors. Oppenheimer studied it a couple of years ago and found out that more than 50 percent of widows switch financial advisors after their husband’s death. Neuberger Berman followed that up, studying three years after the death, and found out that 70 percent of widows switched financial advisors within three years after a husband’s death. That’s shocking. Why?
Most people say, “Well, it’s because the financial advisor didn’t have a relationship with the wife before the husband died.” We’re in a patriarchal, male-oriented, left-brained world. The financial advisor deals with the husband and does not build the relationship with the wife like he should. Then the husband dies and the wife goes elsewhere.
That could be a factor. But I propose an alternate theory. Even if the financial advisor had no relationship with the wife before the husband died, if she comes in for the post-funeral appointment and he makes her feel like he cares about more than just her money, if he knows what to say, he knows what to do, he knows how to act, and he supports her in her grief, why would she go anywhere else?
At the same time, even if he did have a financial or professional relationship with both her and her husband before the death, if she comes in for the post-funeral appointment, and he’s very awkward, doesn’t know how to talk to her, doesn’t know what to say, doesn’t know whether to mention his name, doesn’t know how to support her in her grief, and then she meets somebody else who does know, she’s going switch. So, perhaps it’s my bias, but my personal opinion is that the reason widow’s switch is based much more on whether the advisor knows how to support them in their grief than it is based on whether they had a prior relationship.
It is very common for young financial advisors, or financial advisors with young clientele, to think they don’t need this training. Death hasn’t personally touched them yet. And I understand that. I’m the third of ten children. All of my siblings, all of their spouses, and my parents are still alive. And it’s very easy to assume that death is in the very distant future… to just get complacent. It is very easy to say, “Well, death hasn’t touched me. I don’t have to look at that yet.” Death is very uncomfortable, so you don’t want to look at it. Unless something pushes you to look at, we tend not to. Unfortunately, that’s not a good position because grief and death education is like life insurance. It’s too late to purchase life insurance after the death and it is too late to learn about grief support after a death.. You have to prepare yourself ahead of time. Everybody’s going to be touched by death. The death rate is one per person and nobody’s going get out of this world alive.
Those are the honest facts. Everybody’s going to be touched by death. You can’t judge by age. My husband died at the age of 25 when our son was 7 months old. The life insurance proceeds from his death would have been a nice addition to any financial advisor’s book of business. My first husband’s father owns 140 acres of prime Iowa farmland and he is now 97 years old. When he dies, John’s share of that 140 acres of prime Iowa farmland is going to pass per stirpes to my son. If a financial advisor gains my trust and my loyalty when my husband dies, he’s also going to be taking care of my son’s share of the proceeds of the sale of that land. Doesn’t every financial advisor want that? Basically, you have nothing to lose by getting the information you need about death and grief education. You potentially have a lot to lose if you don’t.
One of the biggest objections I hear when I teach financial advisors and estate planning attorneys about grief and death education arises when I tell them to ask questions, and to listen. They say, “Whoa, wait a minute. I don’t want to intrude on their personal life. I don’t want to make them cry. I don’t want to cross professional boundaries. I’m not a psychologist. I’m not a counselor. How can I be asking these kinds of questions?”
That’s very common, not only in financial service professionals but, really, in society as a whole. We very quickly turn to telling somebody to put it behind them and get on with life now. It only takes a couple of weeks after the death before people don’t want to hear the story anymore. They will talk about anything and everything except the person who died. They won’t mention their name. They won’t take the risk. They won’t ask, “How are you doing?”, and sincerely want know the answer.
If the financial advisor acts like that, then the financial advisor is no better than anybody else in the rest of society. And, in the meantime, the grieving person is hungry to tell their story, to be heard, to mention the name of the person who died. They don’t want to forget. You don’t want to forget somebody you loved. But when nobody will mention the name, you feel like you are alone, like nobody else remembers, like their life didn’t make a difference. If you aren’t allowed to tell the story, it’s as if it didn’t happen. It’s as if nobody cares.
If the financial advisor does not ask the questions, sitting across the desk from a grieving widow or widower, then that grief, that death, is a big elephant sitting right there on the desk between you. You both know it’s there, but you are trying to look under it and around it and over it and trying to avoid it and pretend it’s not there. It’s terribly uncomfortable. And it’s just what she’s getting everyplace else in society.
If you ask the questions, you can ask them in ways that just open the door. When you ask an open-ended question, you crack open the door. He or she can close the door. They don’t have to walk through it. They don’t have to talk about it. Most of the time, you’ll find that they will, because nobody else is willing to listen. They’ll at least test the waters. They’ll say a little bit. And then, if you follow up with another question after that, and they say a little bit more, and you follow up with another question, then they know you really are interested. You really do care about what they are going through. You really do care about them as a person, not just their money. There’s no better way to build trust and loyalty than by opening the door and following their lead. If they walk through it, you walk through it with them. If they slam the door shut, fine. Then, they don’t want to talk about it and you leave the door shut. But, at least the big elephant isn’t there. You’ve acknowledged the reality. You’ve acknowledged it’s there and let them take control of the conversation.
My summary:
There’s a death boom coming. All of these baby boomers are going to be dying. Their parents are already dying. Seventy-one percent of the baby boomers still have at least one living parent. That’s 53 million of them. They are entering their 80’s, entering their 90’s. There is a death boom of unprecedented proportions coming. Those baby boomers and their kids are going to expect more of a financial advisor than just knowing how to invest their money. They are more demanding. We know that; all the demographics tell us they are more demanding. They want you to care about them as a person, not just invest their money.
The #1 relationship need people are going to have in the coming years is help dealing with their grief. They need and want help dealing with the death situations they are encountering in their lives. Even with a young clientele, their parents are going be dying. Their spouse might die. Their child might die. Age is not a predictor of when any single person might die. Young people die all the time and young people are affected by death all the time.
The more you know about how to support people, how to talk with them, how to act around them in their grief, the more you are going to become the go-to person, the one that everybody wants to give their business to. People are going be looking for a financial advisor who supports them in their grief and, if they find that, they will give that financial advisor their business. You don’t want to meet your doom; you want to meet your boom.