Her bags are packed, but there's one thing left to do. Ruthie checks her smartphone and confirms that the dog sitter is scheduled to come by today to feed Bella. As she's browsing her dog sitting app, she receives a text message that the Uber her grandson sent for her has arrived. She locks the front door and gets into the car as her driver kindly puts her suitcase into the trunk. Ruthie's adventure has begun. It's time for the trip of her lifetime: a cruise to Alaska with her children and grandchildren.
This new method of buying, sharing, renting and trading goods and services is a shift away from traditional buy-spend habits. People like Ruthie are using peer-to-peer and community-based online services to get better deals that are more convenient and more memorable. Contrary to popular belief, more and more people over the age of 65 actively participate in the sharing economy, both as users and providers of goods and services. According to PricewaterhouseCoopers' Consumer Intelligence Series, 17 percent of Americans 65 and older consider themselves providers in the sharing economy, compared to just 7 percent of all Americans.
What exactly draws seniors to the sharing economy? Longer life expectancies and under-utilized assets.
People are living longer and need more supplemental income than they originally planned for, driving them to find creative revenue streams. With one in four Baby Boomers planning on working until they're 70 years old – up 9 percent compared to five years earlier – seniors want to find ways to earn money on their own terms. After a lifetime of accumulating assets, older Americans have high value, under-utilized possessions and skills that they can put to use to supplement their retirement income. Cars can be used for ridesharing and extra bedrooms can be rented on home sharing websites. As seniors put their underutilized assets to work, the same logic can be applied to a financial asset that many older Americans own: their life insurance policy.
Life insurance is often an under-utilized asset that older Americans no longer need. The reason for purchasing a policy in the first place may change 30 or 40 years later. Typically, people take out life insurance policies to financially care for loved ones in case of an untimely death of the policy owner, but over time policy owners find that their original purpose for buying life insurance has changed. Additionally, premiums become incredibly expensive and oftentimes difficult for retirees who are on a budget. Most people don't realize that a life insurance policy is personal property, which means it can be sold to whomever the policy owner chooses. Currently, more than 500,000 seniors lapse their policy annually, and just 1,250 take advantage of a life settlement. That’s only 1 in 400 people who benefit today from an underutilized asset, whereas 90 percent of seniors who lapsed a policy would have considered a life settlement had they known of the possibility (Insurance Studies Institute). Rather than giving up a valuable asset, more seniors should consider turning their under-utilized asset into value by way of the sharing economy model.
Each individual scenario could be different based on the parameters of the transaction. To understand the life settlement process, please visit LISA.org.
The way people shop, buy and sell goods and services has drastically changed in the last 50 years, and will continue to shake up more traditional industries as consumers demand simplicity and convenience. PricewaterhouseCoopers believes that the sharing economy will grow drastically within five industries – automotive, hospitality, finance, staffing and media streaming – from $14 billion in revenue today to $335 billion by 2025. With one-fifth of the U.S. population projected to be 65 years or older in 2050, many sharing economy goods and services will be geared towards the lifestyles of older Americans.
Ruthie steps off of the cruise ship with her 10 family members in tow, ready to catch a Lyft to the Airbnb she rented for their stopover in Anchorage. As she settles into the living room of the large vacation home, she watches her family prepare dinner and is thankful she is able to afford to pay for this memorable trip with her life settlement money. Memories made today last beyond a lifetime.
Scott is a compelling leader who executes change by using technology innovations to build relationships and make a difference. With 20-years of marketing experience, Scott is CMO at Magna Life Settlements, a multi-billion dollar alternative asset manager specializing in noncorrelated investments. Scott is also Co-Founder of Social Factor, a national social media strategy & execution agency with a proprietary ROI-centric approach to social. As volunteer Board Chairman of non-profit Young Life Greater Austin, Scott’s leadership has seen the relationship-based mentor program grow 6X to 50 schools, 1000 volunteer leaders, 35 staff, 2000 campers alongside thousands of Austin adolescents. Previously, as PGi VP Sales & Marketing, Scott built annual sales and lead revenue for the Global Online channel while directing 50+ millennials in four continents. Earlier, Scott served as Editor-in-Chief for Dell.com/Enterprise, founder/CEO of interactive dialogue software co. (acquired by SalesFusion), Product Director at Austin Ventures, and Sales/Engineer at Merck. He has a BS Engineering and MBA from The University of Texas at Austin.