Baby Boomer Turned-off by Financial Jargo-What an Opportunity for Financial Services, but…
Posted on July 22, 2008 by John Todor
By John I. Todor, Ph.D., author of Get with it! The Hands-on Guide to Using Web 2.0 in Your Business. (www.TheWhetstoneEdge.com)
My sources within the financial services industry say they are very interested in doing business with baby boomers and they think customer relationships are very important.
Here’s the perception of the other side (source AARP magazine, Jul/Aug 2008):
60% of 50+ Americans say they don’t read financial literature because it is too hard to understand.
41% of 50+ Americans are turned-off by financial jargon.
54% of 50+ Americans think an Internal Revenue Service tax form is easier to understand than a mutual fund prospectus.
Why do financial-service professionals and companies use complicated jargon instead of plain English? Here’s what 50+ Americans think:
63% say it is to make a product or service seem more impressive.
50% say it is to distract people from focusing on the fees they will be paying.
50% say it is to make consumers feel less confident about handling their own finances.
One group wants customers with money. The other group has money and they want help. Where is the problem?
I did a very informal survey of some financial advisors about the situation and the most common response was, "we are not responsible for the jargon, the companies are."
Once again, what an opportunity! Financial advisors should advise. But people don’t like taking advice from people they don’t trust. A first step in building trust is helping clients understand what they don’t understand.