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Insights from a "money organizer": Planning does not start at 50; it starts at 30.

Reflections that emerged from my chat with my 73-years-old dad about how he sees finance today in light of yesterday.

Photo of Anne-Laure Fayard
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I interviewed my dad, who is 73 years old. He was a civil officer (for the French government) and is now retired (note that he worked until he had to retire and we all joke about him always working on various projects – mostly volunteering and a few consulting).  I chose to interview him as I always go to him if I need advice about finance (and any administrative matters) and he always seemed to me as well-prepared and organized. I would not describe him a  risk-taker or a finance guru, but someone who is efficient, organized,  structured and diligent.

So I thought there will be a lot to learn from him and there was! :-) 

Some background / family information

My dad is married to my mother who was a lawyer and is also retired.  They are both healthy and own an apartment in Paris and a house in the countryside. They also have a car. (All of this has been paid). They don’t travel much (for leisure) and go to their  countryside house during the holidays.

We are three siblings (my brother, sister and I). All of us have a job, a place to live and children. 

Regarding helping their children, my dad said “the principle is: we paid for their studies and they should figure it out.” Yet, because of my brother’s situation (creator of a small business, divorced and living alone with 3 kids), he explained that they have to help him financially. He added that my mother also worries about my sister and feels she needs to help her and babysit her kids. 

My grand-mother lives on her own and is completely financially independent.

Learnings: it is important to be aware of the bigger family context. And children, even when grown-ups, influence some parents decisions.

(Related side-note: one of my friends told me that her parents who are 80+ and needed some money, did not want to sell a property they have because they wanted to “keep it for their children”, who are all 50+ with a stable job and a house!)

Finance:

My parents have accounts in 2 banks.

The only loan they have is for “financial accounting” because that “was cheap money” (due to low rate).

My dad is the one in charge of the finances. He does everything online. 

When asked about security, he said “I’m not scared but I’m careful”. He checks his accounts generally twice a week, at least once, just to see if there’s any anomalies.

Technology:

He pays everything by cards or bank transfers. The only time they go to the bank  is when they have checks to drop (and this is very rare).

When asked about age and using technology, my dad said “I don’t think it has anything with age. It’s more about personality. know young people who go to the bank.”

Financial advisors:

When asked about financial advisors, he responded, “I haven’t found one who has useful advice!” so he does not have one. He then told me that when he had a problem, it happened two or three times that he found a financial advisor who was helpful for a specific case.

Learnings:

  • Technology is not necessarily an issue for all 50+ and even 70+.
  • Some people, when it come to money are “out there”, well-organized, conscientious and efficient, and they don’t necessarily need a financial advisor.
  • Trust, but also competency is an issue with financial advisors.


Planning

I asked him about planning and asked him about now vs. when he was in his 50’s. He first noted that planning does not start at 50, but that for him planning was between 30 and 60.

He had a life insurance (his main issue was to have enough for the person staying to cover the costs and get back to a normal life). He will stop it when turning 75 because the premium then becomes too high.

He also took some education insurances for each of us so that we could study until we were 25 years old.

Learning: Planning does not start at 50!

Constraints:

Retirement:

He explained me that starting 40-45 years old, he started checking how much he will get for retirement and how my mother will get. Because they are in France, retirement is compulsory but you can consider taking a complementary retirement plan which he did for her at some point.  

Children:

“You have to plan that your kids will cost you more as they grow. But usually there are no major extra costs and you can absorb them in your budgeting.”

We discussed that they did not have to worry about studies like people do in the US because in France universities are public and even private schools are not expensive. 

Learning: constraints are part of life and you just have to be ready for them; one can think of loans in a creative manner.

… and dreams

My dad is not a dreamer but my mother has dreams. She always dreamt of having a family house and so when they were in their 50’s and became grand parents for the first time, they bought a house in the countryside. For that, my dad sold some stocks he had. He described this as “getting rid of a financial investment that corresponded to your mother’s dream”. 

Learnings: one can balance dreams and efficient financial investment. When you’re married, people have different dreams and you need to find ways to fulfill them.

Overall learnings

  • Planning starts before 50. Let's keep that in mind when we move to ideation.
  • Not all 70+ are scared of technology
  • Trust about financial advisors is not only about security, it can also be about competency. Where to get information (trustworthy and understandable) is not easy.
  • I was impressed by the organized and efficient approach of my dad but I also realized I was "far beyond".  Although I unconsciously picked some tricks, I am definitely not a money organizer. 

What is a provocation or insight that might inspire others during this challenge?

How might we design solutions that acknowledge the diversity of needs and behaviors among 50+? How might we get people to start planning "early enough"? How might we help people who are not planners to plan "without knowing it"? How might we design solutions that go beyond "technology"?

Tell us about your work experience:

I'm an NYU faculty and teach Design Thinking and Organizational Behavior. I'm also the advisor to the Design for America Studio of NYU. I'm passionate about human-centered design.

Specifically, please check all that apply:

  • I'm not currently involved in a credit union, but am curious to learn more!

8 comments

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Photo of Jaskeerat Bedi

I loved your post Anne-Laure Fayard ! Most important learning and insight from this was, that planning doesnt start at 50, it starts much earlier. To be able to look and plan that far ahead in the future is not something that comes naturally. The seed of financial security should be seeded, nurtured and looked after for !

Photo of Anne-Laure Fayard

Thanks Jaskeerat Bedi For me the planning starts earlier was also the main insight. This also resonated well with some of the insights from the Higher Education Challenge. By the way, check the 2 events we are organizing with NYC OpenIDEO chapter https://beta.openideo.com/chapters/29

Photo of Juliette Laborie

Hello Anne-Laure Fayard , thanks for the great contribution! It's very insightful. Building on it, and on my own parents' situation - which is quite similar in terms of age, country of residence, etc., I think it's important to point out that 50+ people are a very diverse population,  in terms of situation, needs, expectations, tech skills, etc. 

For instance, on planning: it shouldn't start before 50, indeed, but some people do start much later than others  - that's a key difference in terms of needs and resources when you reach 50 or 60, to the tune of having people close to poverty vs. people who are quite financially secure. Their needs will be quite drastically different.

Also, I've very often heard my parents complain about being targeted only by offers designed for "old" people as soon as they turned 50 or 60 - when at that age, they were still very much active, up to date on technology, and full of projects big and small. It seems that being 50 or 60 today is not the same thing at all as it was 20 years ago, but that change isn't necessarily reflected in the financial offerings existing today.

And that actually leads me to question the segmentation of this challenge - we are talking about 50+ people, but perhaps there should be a more refined segmentation instead, e.g. the 50-70 yo vs. the 80 and older? I'm basing this on personal observations, but it really seems that there is a significant difference between people like Anne-Laure's or my parents, who are still on the younger side of the age group, and people who are over 80 years old or even much older, but sill still need the right financial products for them.

I hope this helps further the thinking !

Thanks

Juliette

Photo of Anne-Laure Fayard

Hi Juliette Laborie thanks for your comment. I agree on highlighting the diversity of the 50+ group in terms of needs, resources, preferences and tech skills. It's in fact very visible from all the interviews posted during this phase and that's I think the beauty of this phase: highlight similarities and variations.  I also agree that not everyone starts planning before 50 but the value of this insight was to challenge the starting point of 50+: maybe we should think of solutions for users before 50+?  Last, completely agreed on the need to refine the segmentation. Several posts have highlighted variations between 50+ vs. 60+ vs. 70+ Check also my post on the topic: https://challenges.openideo.com/challenge/financial-longevity/research/meet-the-perennials Thanks again for these great points. Clearly important to keep in mind when moving to ideation.

Photo of OpenIDEO

Congrats on this being today's Featured Contribution!

Photo of Anne-Laure Fayard

Thanks!

Photo of Kate Rushton

Thank you for your post Anne-Laure! Do they plan to keep two homes for the foreseeable future or is it likely that they will sell one and live solely in one home?

Photo of Anne-Laure Fayard

Thanks Kate. No plans to sell the house in the countryside. Yet, their main residence is their apartment in Paris.  They go to the countryside only for holidays, in particular with their grandchildren.