Talking with baby-boomer clients about the realities of retirement calls for a specific set of skills.

“We’re financial advisors first and psychiatrists second,” says Angelo Vicere, senior financial advisor and branch manager with Assante Capital Management Ltd. in Hamilton, Ont.

Here are a few realities your baby boomer clients may need to face as they approach retirement:

> When they can retire
Make sure your baby-boomer clients are realistic about their retirement date.

“People are too optimistic about their retirement,” Vicere says. “[They think] they can retire at 58 and live this grand life that they see on TV, of the guy running on the beach.”

From a financial point of view, Vicere says, most people are in no position to accumulate the money they would need in order to retire that early.

> What they are going to do
Get boomer clients thinking about how exactly they’re going to be spending their time.

Your clients are retiring from work, but you must ask what are they retiring to, Vicere suggests. Your clients typically could be retired for 20-30 years, yet most boomers have not considered exactly what they are going to be doing with their time.

Suggest your boomer clients take up hobbies they enjoy and maintain social networks, which health professionals say help seniors stay physically and mentally healthy into old age.

> The danger of reacting to news
Tell your boomer clients to stay calm about the economic events.

Boomers often become nervous when they see negative reports about capital markets and the world economy, Vicere says.

“I have clients who get email messages if a stock hits a certain price,” he says. “We’re in this world where there is instant feedback and it’s almost as if people have to tinker every week with their portfolios based on something in Greece or Italy or whatever the current headline is.”

Reassure clients that your team is well acquainted with [volatility] in the market and that you have a strategy to defend against them, he says.

> Importance of staying the course
Sometimes clients may want to make some hasty decisions right before retirement. Make sure you give them a quick reality check before they do.

In times of market volatility, many clients may want to switch into a locked-in product such as a five-year GIC, Vicere says. The problem, he says, is that most clients who make such a move experience “buyer’s remorse” three months later, when the market goes back up.

“If you’re going to make changes in your portfolio,” he suggests advising clients, “take baby steps.”

IE