Till death do us part.

There are nearly 11 million widowed women in the US, according to the Census Bureau, yet few advisors make this their niche. That’s unfortunate for a few reasons, according to experts at the American College of Financial Services’ Horizons retirement conference held this week in Orlando. For starters, widows often need expert financial guidance and emotional support, but advisors who take a standard approach could risk alienating them. Serving new widows requires a whole different playbook, the panel agreed, and advisors who are not prepared for this transition risk losing client relationships, mishandling communications or overlooking critical financial planning actions.

“The best piece of advice I can give about serving widows, especially very new widows, is to not give in to your normal instinct of trying to jump right in and solve problems,” said Kathleen Rehl, an adjunct professor at the American College. “You have to lead with empathy and let them grieve.” There are some early actions that need attention, of course, like getting a death certificate and filing life insurance claims. “But the majority of the big planning decisions that will affect long-term retirement security don’t need to be rushed.”

Lessons From Experience

Rehl, who is now 80 and continues her practice as a financial advisor, was herself widowed 20 years ago. “Even though I was a CFP and a Ph.D. with all the knowledge I needed to manage my finances, I still went crazy when my husband died,” Rehl said. “Now imagine what a widow goes through when they don’t have a lot of financial knowledge.” Sadly, that situation is far too common:

• 14% of married women over the age of 20 have been widowed, Census Bureau data shows.
• That rises to 58% of women over the age of 75.

Naturally, advisors want to solve issues right away and help clients find solutions to their financial problems, said Lindsey Lewis, managing director and chair of the college’s Center for Women. “But remember, grief causes real cognitive difficulties,” she said. “People rush decisions or they forget important things.” The real job of the advisor is to slow things down and reduce the number of pressing decisions very early on. “Don’t look at it as primarily a money thing at first,” Lewis said. ”Take a beat to recognize the grief.”

Rehl’s other practical advice for the early grieving period: “Don’t hand your crying client a tissue. It sends a signal that you’re uncomfortable and want them to stop. Put a box of tissues on the table before the meeting.”

When it’s eventually time to do more in-depth planning, some things to consider are that widows often face significant financial challenges, primarily driven by a drop in household income (losing a Social Security benefit or pension) coupled with high, fixed costs like housing. Other key issues include navigating complex tax changes as a single filer, managing debt and taking on sole responsibility for financial planning.

What About Widowers? The planning challenge is markedly different when it comes to widowers. Anecdotally, they tend to get more overwhelmed with day-to-day tasks and household management things, Rehl said. On financial issues, they can be over-confident, even when their financial acumen is low. Widowers also struggle more with social isolation and loneliness, and they tend to remarry more often. That brings in another set of financial and behavioral considerations, including whether to merge finances upon remarriage.

You know that leading advisors regularly read Retirement Upside, right?

While that’s true, it’s also an example of a persuasion technique that behavioral psychologists call “social proof” or “herd mentality” in action. Social proof is a documented psychological phenomenon in which people mirror the actions of others to behave more appropriately in uncertain situations. Driven by the assumption that others possess more knowledge, individuals tend to conform to group dynamics to fit in or make faster, validated decisions. While research suggests social proof is useful in some financial planning contexts, such as when suggesting clients switch from mutual funds to exchange-traded funds for their greater tax efficiency, it’s not universally helpful. In fact, a new study conducted by the AI company Jump, in collaboration with retirement researcher Eric Ludwig, suggests social proof is actually counterproductive when promoting annuities, so much so that advisors should probably avoid it.

“This was a surprising and very interesting finding,” said Liam Hanlon, head of insights at Jump. “If you didn’t actually look at the dataset, you would just assume that social proof would work for annuities. Not so.”

Mind Those Assumptions

Probably the most famous example of the social proof effect was documented in a 2008 study by Robert Cialdini and colleagues, who found that telling hotel guests that “the majority of guests in this room hang up and reuse their towels” meaningfully increased towel reuse compared with standard environmental messages about saving water. That result led researchers to ask whether social proof works in other contexts, and the answer was a clear (but not universal) yes.

Given his focus on retirement income planning, Ludwig wondered whether social proof would work for promoting annuities. Answering the question required constructing a large dataset based on anonymized client-advisor conversations captured by Jump’s notetaking and automation platform. The results were clear:

• Utilization of social proof framing reduced the acceptance rate of annuity purchase recommendations by nearly 18%.
• The only greater negative effect occurred with framing annuities as a solution to long-term inflation, which reduced acceptance by about 19%.

“The inflation framing turning out to be negative was also pretty surprising,” Ludwig said. “We can’t say for sure why these two techniques are counterproductive, but we can point to approaches that seem to work better.”

What Actually Works. The first of those, default bias framing, involves suggesting to people that a certain course of action is the normal or expected course. This strategy increased annuity purchase recommendation acceptance by nearly 27%. The second, consistency framing, involves reminding people of repeated receptive conversations about a given action or decision. That approach increased acceptance by over 20%.

America’s small businesses have a big problem.

While publicly traded companies dominate headlines, most US businesses are small and privately owned. Yet retirement savings access hasn’t kept pace: Nearly two-thirds of employees at businesses with fewer than 50 workers lack access to a retirement plan, according to Georgetown University research. And we don’t have to tell you how nervous Americans are about retirement; just picture the “This is Fine” meme of a cartoon dog sitting at a table in a burning room surrounded by flames.

Many small businesses assume offering a retirement plan is too expensive or time-consuming. Accountants, lawyers and financial advisors serving those firms sometimes share that perception. But those concerns may be overstated, according to a Boston College survey. “Professional service providers for small employers are trusted partners in key business decisions,” researchers said in the survey. “Improving knowledge and shifts in framing, as well as more involved guidance, can meaningfully influence whether a small business offers a retirement plan.”

Run for Coverage

There are affordable options even for businesses operating on thin margins. Boston College researchers pointed to 401(k) plans costing employers less than $2,000 annually for a five-person firm and under $3,000 for a company with 25 employees. The survey also found:

• Advisors who actively help clients set up retirement plans and frame them as recruiting and retention tools are far more likely to work with businesses that ultimately adopt plans.
• Discussions around pooled employer plans, multiple employer plans and different types of 401(k)s were also linked to higher adoption rates, while an emphasis on simplified employee pension IRAs correlated with lower coverage.

All in One Place. Some firms are trying to bridge the gap by bringing retirement plans directly onto the software platforms small businesses already use. The fintech Vestwell and Intuit announced this week a plan to embed retirement savings plans into QuickBooks, which millions of small and midsize businesses rely on for payroll, finances and employee management.

“It’s not that small business owners don’t want to help their employees save for retirement,” Vestwell founder Aaron Schumm told Advisor Upside. “It’s just been really complicated and burdensome. If nothing changes, we’re looking at a generation that simply cannot afford to retire.”