FINTECH SNARK RESERVOIR OBSERVATIONS

Over the past few weeks, two of my contacts have announced new jobs on LinkedIn. Nothing unusual about that, is there? Except that both had announced their retirement in the last two months. As one of them told me: “I failed at retirement.”

The rise of the ReBoomers

These examples are signs of a much broader trend. Baby boomers are not “retiring” in the traditional sense. They downgrade to become gig workers, have side hustles, and become influencers. However, they don’t call it “advice.”

Or they come back, full time and with full force. One of my contacts is returning to become the CEO of a $30 billion bank and the other as the chief revenue officer of a fintech startup – neither of which is a “stress-free job.”

This is not surprising. Baby boomers have (or had) jobs that challenged them mentally and kept them sharp. They can’t give it up.

This downgrading creates new needs and demands for financial service providers in terms of cash flow management, tax planning, accounting/invoicing – and all the other things young gig economy workers need. need.

The Problem of Elder Financial Abuse

There is another boomer need – more so for older boomers than younger boomers – and it has been around for some time: protecting seniors from financial fraud.

Comparitech estimates that in 2023, Americans over the age of 60 suffered more than $38 billion in losses due to financial exploitation, triple the amount they lost in 2022. Tech support scams were the type most common fraud reported to the FBI’s Internet Crime Complaint Center (IC3).

In 2022, the Financial Crimes Enforcement Network (FinCEN) alerted financial institutions to increasing levels of financial exploitation of older adults, highlighting new typologies and red flags.

The schemes typically involve the theft of a senior’s assets, funds, or income by a trusted person or the transfer of money to a stranger or impostor in exchange for a promised benefit or good that never materializes. Scams often involve fraudsters located outside of the United States. States with no known relationship to their victims.

The Senior Financial Management Opportunity

Over the next 10 to 20 years, the needs of ReBoomers will shift from on-demand work management – ​​I mean “consulting” – to fraud protection, wealth transfer and expense management. And they will need help from their adult children.

As if it wasn’t already difficult enough to manage your own financial life, a new study Since Core Advisors found that one in 10 Americans whose parents (or one parent) are over 60 do all or most of the work needed to manage their parents’ financial lives, and an additional 28% help them from time to time .

The number of consumers involved in managing their parents’ financial lives is poised to explode. The Cornerstone study found that one in five adults whose parents are over 60 anticipate that, in five years, someone will need to take over management of their parents’ financial lives. In 10 years, this percentage increases to almost 40%.

In fact, most baby boomers expect to need help managing their finances, but they just don’t know when.

Among consumers whose parents are 60 or older, about 80% are interested in senior financial management: digital apps that help them prevent fraud against their parents and manage their parents’ financial lives.

Specifically, they’re looking for features like alerts for withdrawals, recurring bills and deposits, as well as a fraud protection score and spending limit controls. It is important to note that these consumers say they are interested in obtaining these tools from the banks with which they already do business.

For a $50 annual fee for the service, Cornerstone Advisors estimates the revenue potential for senior financial management at nearly $2 billion per year.

And that doesn’t include residual benefits such as seizing wealth transfer opportunities or eliminating or reducing financial losses through better fraud prevention and protection.

The new banking reality

Generations X, Millennials and Z are not going to like this, but there is a new reality in financial services: the new emerging generation of banking consumers is the baby boomers.

It’s the revenge of the ReBoomers, the generation that will not disappear.

To obtain a free copy of the report, The Boomer-ang effect: A billion-dollar opportunity for banks in senior financial managementclick here.