Engaging Your Most Valuable Account Holders and Getting Ahead of Wealth Transfer

Banks and credit unions are facing a pressing challenge: the coming flight of assets from retirement-age account holders. Americans over age 50 control more than 80% of US household wealth, so keeping those assets is a strategic priority. As the baby boomer and Generation X (Gen X) generations approach retirement, we are beginning to see the first of two massive wealth transfer events. Wealth transfer presents both risks and opportunities for financial institutions (FIs) willing to proactively engage their retirement-age account holders today, understand their needs, and adapt.

Understanding the Challenge: Two Events, Not One

The first and most important asset flight event occurs when account holders who are nearing retirement consolidate their assets at a handful of favored financial institutions. This phenomenon is driven primarily by a desire to simplify their lives, along with dissatisfaction with FIs that do not respond to their changing needs. The few FIs that are not consolidated out retain the relationship for two more decades on average (Americans can expect to live twenty years or longer in retirement) before the second event–wealth transfer to heirs–takes place. 

Today, it is an urgent and highly strategic priority for FIs to understand and respond to the changing needs of account holders over 50 in order to keep their assets and their loyalty. 

Understanding Financial Life After 50

As Americans move through their fifties and into retirement age, they wrestle for the first time with many high stakes questions that have no easy answer. The most common is “how long will my savings last?” Answering this question requires integrating financial, health, and economic topics (including highly complex programs like Medicare and Social Security) with evolving personal priorities, health, and family circumstances. 

If you know anyone going through this, they will tell you it is challenging, stressful and overwhelming. It is the first time major financial decisions must be made without a simple northstar metric, like FICO or net worth in earlier phases of life. Additionally, this is the first generation to have to make these decisions on their own as they are the first generation to retire without the benefit of a pension. It’s no wonder that over half of Silvur’s survey respondents say their primary emotion with respect to retirement is anxiety (Silvur User Surveys, 2021-2023).

The Right Way to Support Your Account Holders

Silvur has partnered with Alkami to make it easy to help your account holders with this acute unmet need, improve engagement and value delivery, and avoid being one of the FIs that is consolidated out during early retirement. Silvur offers over 800 classes, powerful calculators and a proprietary Retirement Score, a north star metric soon-to-retire Americans need to guide their complex decision making–all accessible from within Alkami’s digital banking platform.

Strategies for Engaging Retirement-Age Account Holders

The Silvur-Alkami partnership offers a roadmap for how to effectively engage retirement-age account holders to mitigate asset flight and uncover new opportunities:

• Stop Asset Flight: Retain direct deposit relationships lost at retirement (up to 80%)
• Deliver Unique Value: Become the trusted place your account holders return to again and again for complex retirement decisions
• Broaden Your Reach: 97% of Americans will need help with Social Security and Medicare, which are not topics that wealth management teams are equipped to support  
• Earn Trust: Personalized experience from log in, through research, to finding highest-impact actions, all in a white labeled experience
• Uncover New Opportunities: See hundreds of millions in new asset opportunities, understand how much of your account holders’ assets are likely to move and when. For most partners, over 50% of investable assets are likely to move in the next 4 years.
• Awareness and Acquisition: Embed products and services to broaden product awareness, add acquisition channel
• Boost Return-on-Investment (ROI): With campaigns and offers powered by first party financial, demographic, interest and intent data 

Cultivate Long-Term Relationships with Insightful Consumer Banking Solutions

Engaging retirement-age account holders is a strategic imperative for banks and credit unions. By offering personalized content, powerful calculators and the Retirement Score, Silvur helps financial institutions build trust, loyalty, and long-term relationships with this demographic to reduce the risk of asset flight, uncover hundreds of millions in new assets, and position themselves for success in the evolving financial landscape.

¹Silvur analysis of partner data conducted Feb, 2024