Baby boomers are increasingly seeking ways to simplify their lives, said Valerie Brown, president-retail annuities market segment for ING U.S. Wealth Management, Hartford, Conn.
For instance, boomers want to deal with just one institution and just one intermediary, Brown said during a panel discussion at the annual meeting here of NAVA Inc., Reston, VA.
To succeed with boomers, the variable annuity industry will need to improve in several areas, she maintained.
For instance, "our industry has too many one-trick ponies; it doesn't focus on the holistic needs of the client."
Instead, the industry needs to bring holistic, full education to clients, Brown said. For example, educate the consumer on all retirement options, not just annuities.
Another problem is, the industry pushes the wrong buttons, "too often using fear as a motivator," Brown said. Boomers do understand the negative risks they face, she said, but they've trained their brains to ignore or discount negative information. "They want positives, to be opened up to opportunities, and not be pushed into the solution."
Still another problem has to do with boomers' growing desire for simplicity. "We speak the wrong language," said Brown, who portrayed the language as "intimidating" and said the marketing materials often have "a lot of jargon."
This problem affects advisors too, she noted. "A lot of advisors don't sell annuities because they don't understand them."
Her suggestion is for the industry to examine the words it uses. For instance, rather than talking about the GMWB, "how about saying 'income for life' instead?"
"We've got to simplify our messaging and remove the jargon," she said.
That's hard work, Brown allowed, but she reminded the audience that "up to 58% of consumers will be switching, or have switched, their advisors as they move into retirement." In short, the opportunity makes the work worth the effort.
