Generation X: Ready or Not, Here They Come - Annuity Outlook Magazine, July 2014


These middle-aged prospects are ready for guidance and products that offer more safety.  Are you ready for them?

Baby Boomers have been big business for insurance professionals. But the spotlight is moving its way across the stage to shine on Generation X. They are ready for guidance, specifically on products that offer more safety. This wave of younger financial consumers (roughly defined as those between 34 and 49 years old) come with little confidence about investing after walking through the dot-com boom and recent recession. They yearn for financial security. Fixed annuities become a natural solution to meet many of their financial planning needs.

Studies conducted since the 2008 crash reveal everyone is a bit more conservative. Even more, Gen Xers in their 40s said they want even greater certainty about retirement income than Baby Boomers did. As Baby Boomers age and begin transferring tens of trillions of dollars to these financially unsure and market-shy individuals, Gen Xers must gradually move to a higher priority for insurance professionals.

This new wave of opportunity is rising – knocking over unprepared insurance professionals and taking business to new heights for others. Gen Xers have a high awareness of the stock market and real estate thanks to the media, but with a sketchy understanding of the big picture. Do you have the tools to get in front of them and adequately meet their new retirement planning needs?

Generation-savvy professionals need to understand and relate to Gen Xers much differently than they relate to their older counterparts. Conventional sales approaches used with Baby Boomers won’t work on this crowd, if you can get your message to them in the first place. Those in their 40s may begin to sense the eminency of retirement, but they have time to count the cost and plan as they wish.

Make a Trail to Your Retirement with Younger Clients

Commission options are part of a growing business and your very own retirement planning. Although the upfront commission structure is the popular choice for agents today, trail commissions can be quite attractive when selling fixed indexed annuities to younger clients and can potentially pay you more over time.

Tapping into Generation X

Earning the respect of your clients’ children now is certainly important – you can likely become their trusted source later. But keep in mind that this marketing tactic only goes so far. Eighty-six percent of Gen Xers say they don’t plan to use their parents’ financial professional.1

This educated generation wants cold hard facts they can put together for themselves to find a good value – and they don’t care much who the information comes from. Gen Xers judge others based on competence.

Of the 40-year-olds who did seek advice following a recent life event, only one in five of the surveyed said they got adequate direction, according to Cerulli Associates.2 Gen Xers want a good value, so they will figure it out for themselves if they must, especially because they feel they have already spent enough on their education as it is.

So, what can you do to get in front of these younger consumers? Here’s what you can focus on to grab the attention of your Gen X prospects.

Get Trust or Bust

For this group, who have witnessed one financial scandal after another, transparency and trusting relationships are critically important. Gen Xers will also judge your competence as well as your motivations, so connecting at a personal level is vital in order for them to see your sincerity and commitment to their financial success.

While you’re at it, be sure to include both genders in your marketing and client discussions. Men and women today are often equally involved in providing income and making the financial decisions for their families.

There Is Power in Technology

Using multiple avenues of communication and technology will keep you relevant with Gen Xers. Websites, blogs, and email, as well as using YouTube, social media, and financial software not only show you can relate to Gen Xers, but they are often the best way to reach this group. These formats not only may reach them more successfully, but will prove to be more cost-effective than the conventional methods that worked with Baby Boomers.

It’s a good idea to get comfortable using programs like Skype, FaceTime, and Google Chat. These technologies are removing geographic boundaries from business today. In fact, according to a Spectrem Group survey, 58 percent of millionaires ages 35 and younger would be willing to use webcam technology to speak to their agents. This trend is growing.

Facts without Frills

Gen Xers are practical and can Google information all day. Unbiased, evidence-based information from someone they trust goes a long way. Whether they get the information from you face-to-face or from your Facebook page, a YouTube video, or a Skype call, the information needs to be honest and factual and show them they are getting a good value. Avoid hype, hard sells, and the extra bells and whistles.

Goals are Like Gold

This younger generation is used to getting a ribbon and a pat on the back no matter what the outcome. This is why it may be smart to set smaller goals along the way to offer the positive reinforcement they need.

Approaches that once worked with older clients may alienate Gen Xers. The sooner agents understand the younger generation, the sooner they can begin offering them fixed indexed annuities and other safe products to meet their retirement planning needs. They are open to learning from trusted professionals who can provide guidance. Will that professional be you?

Characteristics that define Generation X:

·         Market-shy

·         Financially unsavvy

·         Demand transparency

·         Technologically-savvy

·         Desire quantity of time with their family

·         Look for a good value or best deal

·         Prefer email communication

·         Want facts to evaluate on their own

·         86 percent do not plan to use their parents’ financial professional

1 Marston, Cam. “The Gen-Savvy Financial Advisor: Advising the Generations in the New Age of Uncertainty” Generational Insights, 2013. Kindle file.

Cerulli Associates, Boston. “The Cerulli Edge: Retirement Edition.” 2nd Quarter, 2013 Report.


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