A financial planner's guide to retirement coaching

There are many ways in which a financial planner can strengthen relationships with existing clients, as well as gain new ones; and this article discusses one such strategy – called retirement coaching - that may be unfamiliar.

We have before us in our community a rapidy expanding demographic of retiring and retired people. This is not news to the financial planning community, nor to their well-serviced clients. What may be news to some is that this demographic will often benefit from the opportunity, as individuals, to sit with a coach and discuss a central aspect of retired life: what is my life’s meaning now that I no longer work.

Retirement coaching for retired or retiring clients is not the same thing as financial planning. Why is that the case? Picture a person, say 65 years old, recently retired from a lifetime of productive work. A financial plan is in place, that’s a given, and the planner works with this client to manage a good outcome.

Now the planner will also typically have a strong relationship with that client that, over time, will bring forward issues such as taxation and the creation of a will. The average financial planner, not being a specialist in those areas, may want to bring a subject-matter expert to the table. The planner will still manage the relationship with that client, but in the sense of overseeing the outcome with each of those specialists, while not getting directly involved.

This reminds me of the way in which a GP works with a medical specialist. As a patient, I will want to have a strong relationship with my GP, who is there to look after me on more routine matters but also in a holistic sense; yet I will expect my GP to refer me to a specialist with deep subject knowledge as any need for that might arise.

Let us return to retirement coaching and describe what it is in more detail. Most financial planners will have strong evidence from their clients that there is more to retirement than an income stream. Retirement for your 65 year old client above will also highlight the problem of finding a way to live a day-to-day, fulfilling life with its own postwork meaning.

After all meaning is what this client had every day at work for some 40 years. Does it really make sense to imagine that the search for meaning turns off like a tap at 65; soon becoming a daily cocktail of golf, cruises, TV, and so on? I don’t think it is ever that simple, which is not to discount those as earned activities in the first period post work. However, the bloom will fade quickly, I maintain, for the majority.

So, going back to our model of GP plus specialist; doesn’t it make sense for you as a financial planner to have a relationship with a retirement coach who will assist your client in finding personal meaning (and it is truly a personal meaning not a generic one) for this exciting and productive period of life after work?

Then you as a planner will have more time to address all those critical issues of giving financial advice in this ever more complex world of regulation and compliance. Sure, you can try your hand at retirement coaching, but is it worth spending your valuable time in that domain, given that you wouldn’t hesitate to recommend a tax or legal advisor? Also, a point of differentiation arises. This will be a good way to promote your business to new clients - in that appropriate age group - and will certainly enhance existing relationships.

In summary, retirement coaching is a strategy to both assist in the maintenance of existing client relationships, and a sales and marketing tool to grow a financial planning practice.