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Minds Over Machines


The entire wealth management industry manages $16.5 trillion in assets, according to the Scorpio Partnership's 2010 Global Private Banking study released this summer. And wealth managers, at the time were kicking themselves because roughly $10 trillion out of a potential $40 trillion of investable assets-the wealth of the world's highest-net-worth people-hadn't been tapped.

But there's still plenty of money to go after, particularly if you're a fund manager.

It's called retirement money.

The Investment Company Institute Wednesday released its second quarter 2010 report on the "U.S. Retirement Market." Notably, the quarter started out with that $16.5 trillion number again. That was the end of March, the total retirement assets held in defined benefit plans, government pension plans, 401(k), and other defined contribution plans, annuities and individual retirement accounts.

That number fell to $15.7 trillion at the end of June.

The value of stocks fell 11.4%. Bonds returned 3.7%.

But stocks have picked back up, with the Dow Jones Industrial Average closing at 11,107, the day of the ICI report. That's not far off the 52-week high of 11,258. The assets aren't going away.

And Editor Lee Barney picks up on this in her marketing feature on how to reach investors aged 50 or higher with your sales effort.

The key statistic of her piece ("Older Investors Raring to Go,'' page 1) is this: People 50 years of age or old hold 75 % of all investable assets. So if you're going to market your funds to any group, this is the one.

They have the most assets-and they have the most motivation to invest them in mutual funds, exchange-traded funds or bond funds that will let them retire in the style of life that they've accustomed to and not ready to give up.

The key point in her analysis, though, is that this is not a Web generation. That is to say, this is not a group of men and women who turn to a computer screen to get advice on where to put their money.

If you want to reach them, you have to reach out to them. Personally.

Asking the over-50 customer to do self-service advice online is not going to cut it. If you want to get a bigger share of that customer's investable assets, the way to get there is the old-fashioned way. Call on the phone. Knock on the door. Meet somewhere. Show that you know what you're doing. And bring the facts to back up your position.

Once there, show you know what you're doing. Know the number.

Meaning: Show them how much they're really going to need to retire the way they want to retire. Most don't have a clue what the number is. Many just keep working, because they think the money will run out if they don't.

Annuities help curb the fear. So do the kind of "income replacement" funds that Fidelity Investments launched a couple years ago.

But the best way to curb the fear is to show them the math. Show them how far their money can go, if placed in the right kinds of funds. And show how this has worked for other customers, statistically speaking, even if you black out their names, for privacy purposes.

Pixels have no personality. Machines have no soul. They can't do your marketing.

To reach some people, the only way is ... with your people.

The entire wealth management industry manages $16.5 trillion in assets, according to the Scorpio Partnership's 2010 Global Private Banking study released this summer. And wealth managers, at the time were kicking themselves because roughly $10 trillion out of a potential $40 trillion of investable assets-the wealth of the world's highest-net-worth people-hadn't been tapped.

But there's still plenty of money to go after, particularly if you're a fund manager.

It's called retirement money.

The Investment Company Institute Wednesday released its second quarter 2010 report on the "U.S. Retirement Market." Notably, the quarter started out with that $16.5 trillion number again. That was the end of March, the total retirement assets held in defined benefit plans, government pension plans, 401(k), and other defined contribution plans, annuities and individual retirement accounts.

That number fell to $15.7 trillion at the end of June. The value of stocks fell 11.4%. Bonds returned 3.7%.

But stocks have picked back up, with the Dow Jones Industrial Average closing at 11,107, the day of the ICI report. That's not far off the 52-week high of 11,258. The assets aren't going away.

And Editor Lee Barney picks up on this in her marketing feature on how to reach investors aged 50 or higher with your sales effort.

The key statistic of her piece ("Older Investors Raring to Go,'' page 1) is this: People 50 years of age or old hold 75 % of all investable assets. So if you're going to market your funds to any group, this is the one.

They have the most assets-and they have the most motivation to invest them in mutual funds, exchange-traded funds or bond funds that will let them retire in the style of life that they are not yet ready to give up.

The key point in her analysis, though, is that this is not a Web generation. That is to say, this is not a group of men and women who turn to a computer screen to get advice on where to put their money.

If you want to reach them, you have to reach out to them. Personally.

Asking the over-50 customer to do self-service advice online is not going to cut it. If you want to get a bigger share of that customer's investable assets, the way to get there is the old-fashioned way. Call on the phone. Knock on the door. Meet somewhere. Show that you know what you're doing. And bring the facts to back up your position.