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Success with the "aging solo” LGBTQ+, singles and couples

Chris Matugas, Investment Advisor with Connect First Wealth and Credential Securities, shares how his community focus and expertise have helped build an ever-expanding aging solo market for his Calgary-based practice.

July 2021

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Christopher Matugas

Private Wealth Advisor, Connect First Wealth and Registered Representative, Credential Securities

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Creating a fast-growing niche

After more than a decade as a wholesaler, I became an Advisor two years ago, and seized the opportunity to work with a retiring veteran to take over his book of business. Approximately 25% of the high-net-worth clients I acquired were couples, or singles, with no children – a segment otherwise known as “aging solo” that’s growing fast. There are currently 48.9% couples without children in Canada, and in 2016, one person households became the most common for the first time. I’ve since expanded into marketing specifically towards this demographic: I’m constantly educating myself on this niche because there is value to add, particularly when it comes to estate planning, which is quite different without kids to consider.

For example, within Calgary’s LGBTQ+ community, many older clients want to live with like-minded or similar population groups and have no interest in downsizing –as many empty nesters do – or moving from an urban to rural environment. Different factors need to be considered, in fact, we may actually plan to upsize, using more savings to move into an affluent neighbourhood. Without the need to leave behind assets for the next generation, the question becomes, “how can we spend our money in the most tax-efficient way?” It’s about legacy planning more than anything else – and, increasingly, charitable giving.

To actively target this market, I’ve been hosting virtual seminars and webinars on the topic, and also focusing on my centres of influence within the community. We want to ensure that these couples and singles know financial planning services are available to them, and that we have specific expertise in the market, having helped hundreds of previous clients in similar situations. Since the acquisition of the original business, not only have I successfully retained 99% of the assets, I’ve nearly doubled the size of the practice to $150 million assets under management (AUM).

Since acquisition of the original business, not only have I successfully retained 99% of the assets, I’ve nearly doubled the size of the practice to $150 million AUM.

It’s what you know that counts

What’s worked for this particular niche is our experience, because you can’t learn it all by reading a book. It’s dealing with a community over and again, and getting to know the typical hot buttons, or potential concerns down the road. That makes a big difference.

If a client doesn’t have kids, for example, and wants to age in place, they’ll likely need renos in the home they’re residing in currently, such as safety doors and ramps, because there may be no one else to help later in life. Perhaps they need to save extra for long-term care – additional expenses that may not necessarily be considered for people with children – or create a multi-generational network of contacts that can offer assistance down the road.

Another example is income splitting in the LGBTQ+ community, which wasn’t available previously, since marriage between same sex partners was not recognized nationwide until 2005. As a result, not everyone has that set up, so when clients come through our doors, it’s often a surprise that we point out as an option for them. No one really talked about it before, regardless of how commonplace it may seem to be now. And this tax planning can have a material impact on RRIF or pension withdrawal strategies, since they’re able to split that income and tax bill, and no longer require as much cash for lifestyle spending. Having an Advisor who is community-focused, bringing up these issues and making these connections, is (and has proven to be) incredibly valuable.

It’s dealing with a community over and again, and getting to know the typical hot buttons, or potential concerns down the road.

Building trust – and gaining referrals

Our dedicated service and in-depth knowledge have led to many referrals for our business, which is roughly 60-80% skewed towards pre – and post- retirees. Having the ability to reference specific examples of what life will entail for those who have chosen not to have children has been key to earning – and building – trust. Once we onboard a new client, we also make a point of defining communication expectations, and for those who are retiring, it’s a minimum of two meetings a year at the start since it’s a major transition, and no one really knows how much income they will need until they’re living it. It’s like watering with your lawn sprinkler: you may have to turn down the tap if you’re hitting the sidewalk, or turn it up if you’re missing the edges. Until you’re there, you won’t know, and that’s why regular review is necessary to amend the plan as required, which also works to deepen the relationship.

Since COVID-19 and the proliferation of web conferencing platforms, I’ve been receiving out-of-province referrals, which is definitely unique, and to me, a signal of the new world we are living in now. Many Calgarians may retire in BC, for example, (specifically Kelowna or Okanagan), and then they speak to their neighbours about us. While the initial meeting may be in person, most clients are comfortable with video meetings going forward, which allows for faster business growth.

In it for the long game

For Advisors starting out and building their practice, be aware that increasingly, it’s not about the quick sale. What resonates with my clients the most is a plan-focused, product-agnostic and fee-conscious approach. It matters to me that a stock, fund or ETF generates returns after cost, and continually aligns with client needs. That’s how I manage my own money, and it requires thoughtful consideration and preparation.

It’s why I insist on three meetings before even onboarding a new client, giving them time to assess my recommendations and approach, with no added pressure. People really appreciate that – I don’t want anyone to have buyer’s remorse. And that’s how they know I’m a long-term partner, and how I plan to continue growing my practice to achieve my target of $500 million AUM.

Chris Matugas on BMO Global Asset Management

We use BMO Fixed Income ETF Portfolio regularly for clients who don’t want to move to fee-based, but still want to keep costs down, since it’s a simple all-in-one solution that provides efficient and effective access to a diversified portfolio of ETFs. Our team also likes the BMO Global Multi-Sector Bond Fund, as opposed to a traditional Canadian bond fund or ETF because with rising rates and inflation, clients want skilled portfolio managers who are able to allocate capital appropriately, and act nimbly and swiftly.

For more ideas to enhance your practice, or build a resilient portfolio, contact your BMO Global Asset Management Regional Sales Representative.

Connect First Wealth Disclosures:

Mutual funds, other securities and securities related financial planning services are offered through Credential Securities, a division of Credential Qtrade Securities Inc. Credential Securities is a registered mark owned by Aviso Wealth Inc. Connect First Wealth Ltd. is a wholly owned subsidiary of Connect First Credit Union Ltd., offering financial planning, life insurance and investments to our members and their communities. Trademark(s) of Connect First Wealth are used under license by Connect First Credit Union Ltd. The information contained herein was obtained from sources believed to be reliable; however, the accuracy is not guaranteed.

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