Shoemaker ethics: Is your retirement plan well heeled?Article added by Steven McCarty on April 28, 2014
Steven McCarty

Steven McCarty

San Diego, CA

Joined: March 22, 2006

A recent study has found that 58 percent of financial advisors don’t have a written business plan, and 46 percent lack a retirement plan for themselves, despite 14 percent planning to retire within 14 years. What’s that saying about shoemakers?

The study, the first to be produced by the new FPA Research and Practice Institute, attributes this gap to lack of time. Advisors, it says, are simply consumed with their normal tasks. Just as the busy shoemaker’s children go without shoes, so do overworked financial advisors fail to plan for their own retirement security.

Still, as more life and health agents try to position themselves as dually-licensed retirement advisors, the lack of personal retirement planning may actually impose a ceiling on future success. Here’s why.

First, just as children look to their parents for role models, clients often look to their advisors for templates of financial success. If you are encouraging them to adopt your suggested retirement planning process, they will take comfort (and motivation) knowing you have adopted the process yourself. Case in point: Consider what happens when nicotine-addicted patients receive a no-smoking lecture from a doctor who ... surprise! ... smokes? How much credibility will the no-smoking argument have coming from that particular physician?

Second, your advocacy for a product or service will be more passionate — and more effective — if you have experienced the product or service yourself. To optimally sell the benefits of retirement income planning, you should experience those outcomes yourself. Now, you may not have retired yet and thus haven’t pulled the trigger on your retirement income streams. Still, having the plan ready to go will give your sales efforts more weight.

Third, one of the big sales hurdles advisors face is lack of empathy. If advisors can’t or won’t place themselves in their client’s shoes, they won’t fully appreciate their customers’ challenges. Going through the process of retirement income planning will bring you closer to your clients and equip you to deal with their issues authentically.

If you haven’t developed a retirement income plan for yourself, what are you waiting for? Here are some tips to consider as you begin stitching together your own plan.

1. Give yourself a deadline for completing it. It’s too easy to procrastinate unless you have a deadline staring you in the face.

2. Free up leisure time (maybe stop watching a minimally enjoyable TV show) and allocate it once a week for your retirement planning.

3. Buddy up with another advisor who also needs help staying focused. Challenge each other to stay on track.

4. Think about the commissions you’ll earn purchasing the insurance coverage or annuities needed to implement the retirement plan you devised.

5. If all else fails, hire a financial advisor to do the planning for and with you. Even busy shoemakers hire other cobblers when their children’s shoes have holes.
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