Sunday, December 16, 2001

Retirees Peggy Parkinson, left, Amy Kumura, Elaine Miyajime, Amy Mazaki and Clara Asada gather at the McDonald's Restaurant on Waialae Avenue, partly to take advantage of seniors discounts, such as 50-cent coffee.

Selling to seniors

Companies use discounts and free
services to attract a fast growing
-- and free spending -- demographic

Falling interest rates hard for elderly

By Lyn Danninger

AS aging baby boomers swell the population heading toward retirement, businesses are increasing the number of discounted programs and services targeted towards seniors.

To capitalize on one of the fastest growing and most desirable demographics, all kinds of businesses now recognize the need to court the senior market.

"I'm not surprised that companies are noticing that seniors are a valuable market," said Lot Lau, coordinator with the information and assistance service senior hotline for the City and County of Honolulu. "As we offer information and assistance, we are getting more calls from seniors as well as those who are caring for them."

Seniors tend to be some of the most supportive and loyal customers a business can attract, Lau said. That's an especially valuable asset for any company during tough economic times.

"That generation of folks are very loyal, so if a company offers something of value and does it with good service, people tend to stick with them -- whether they are their banks, fast food outlets, travel agencies, supermarkets," Lau said.

Denise Takashima, senior vice president with Territorial Savings and Loan, agrees. The bank has tailored services to the needs of senior citizens for many years, she said.

As a result, about 52 percent of Territorial's customers are over age 55, Takashima said.

Write to us

Do you know of businesses that provide discounts or go out of their way to court business from senior citizens?

If so, we'd love to hear from you. Please write to us, telling us the name of the company and the type of discount or service offered. Send your comments to Stephanie Kendrick, Business Editor, Honolulu Star-Bulletin, 500 Ala Moana, No. 7-210, Honolulu, HI 96813. Or e-mail to

Please be sure to include your name and telephone number in case we have any questions.

What's in this for you? In a few weeks, we'll publish a list of where discounts for seniors are available.

Features like free checking, no minimum balance and, most importantly, face-to-face contact with tellers are important to seniors, Takashima said.

"We're not a high-tech bank. For instance, we don't use voice mail. Our type of customers like to see tellers and they like to see their passbooks," she said.

The bank has also made agreements with other merchants to offer senior discounts, Takashima said.

In its monthly "Club 55" newsletter, there is information directed toward senior citizens and their interests as well as a listing of discounts with other merchants.

It's a good strategy for the bank. Not only are seniors good savers, many are likely to open keiki accounts for their grandchildren. Moreover, if seniors are happy with services, they tell their friends.

"They have a great coconut wireless," Nakashima said.

Bank of Hawaii has also lately embraced the senior market.

"It's an important market for us," said Carole Tang, a spokes-woman for the bank.

In July, the bank started a special checking account called "55 Plus" specifically designed for seniors, Tang said. It offers a lot of free features such as no monthly fee, no monthly balance requirements, free canceled check return, 24-hour banking, free unlimited teller visits and 24-hour telephone banking, she said.

Fast food chains such as McDonald's Restaurants attract a large following of seniors in the morning with their special 50-cent price for a cup of coffee.

At Zippy's Restaurants, patrons 65 years or older can get a senior discount card, said Janine Mamiya Kalahiki, Zippy's marketing manager.

"They get 10 percent off Zippy's or Napoleon's Bakery any day of the week."

Mamiya Kalahiki said the strategy has been good for Zippy's.

"(The seniors) are very loyal to us. They are always around and come in every day," she said.

But companies who want to attract senior business are have to do a lot more than give discounts on coffee.

One of the best known national organization that represents seniors' interests is the AARP, formerly known as American Association of Retired Persons.

AARP now counts more than 35 million people across the country as members, said Joe DeMattos, associate Hawaii director of the organization.

The mission of the organization, which targets people 50 years and older, is to not only to address the needs and interests of members but also to advocate on their behalf.

In Hawaii more than 131,000 people pay $10 a year for membership in the AARP and that number is growing, Mattos said.

"It's probably one of the best investments you can make for discounts anywhere out there," he said.

A sampling of AARP's brochures lists discounts on everything from health care, legal services and money management programs to vacation, travel, entertainment and recreational services.

The new group of seniors coming up is likely to expect even more in the way of discounts on services and products in the coming years, especially as their numbers increase, DeMattos said.

Currently 30 percent, or about 10.5 million, of AARP members are under age 60, according to the organization.

With this statistic in mind, earlier this month, AARP launched a new magazine for members aged 50 to 55. Designed to address the needs and concerns of baby boomers, it is called "My Generation" and is now being distributed to more than 3 million households.




For more information on the seniors organization formerly known as the American Association of Retired Persons:

National Web site
Oahu Information Center 843-1906
Kauai Information Center 246-4500
Hawaii Information Center 334-1212
Maui Information Center 661-0159


Executive Office on Aging



City and County of Honolulu Elderly Affairs Division, senior hotline


Maui County Office on Aging
270 7755

Big Island

Hawaii County Office on Aging


Kauai Office on Aging and Elderly Affairs

Falling interest rates
hard on the elderly and
others on fixed income

By Eileen Alt Powell
Associated Press

NEW YORK >> With each drop in interest rates this year, retirees like Lillian Bukiet have felt themselves squeezed.

Bukiet, an 84-year-old widow in Glen Ellyn, Ill., relies on the interest from her savings to supplement Social Security and pension benefits. As yields have fallen, she's had to cut back.

"You just don't do everything you want, or buy everything you'd like," she said.

The 11 interest rate cuts by the Federal Reserve this year to stimulate the flagging economy have been good news to borrowers, making it possible for millions of Americans to refinance their mortgages and borrow on easier terms. At the same time, the returns on federally insured bank accounts, Treasury bills and money market mutual funds -- the staples of many retirees' portfolios -- have dropped, in some cases to 40-year lows.

The return on a one-year bank certificate of deposit currently averages 2.21 percent nationwide, down from 5.53 percent a year ago, according to, a consumer finance Web site.

"That works out to a difference in interest earnings of more than $3,300 for a $100,000 portfolio," said financial analyst Greg McBride. "That's a big bite for someone who is dependent on Social Security, a pension and earnings from CDs or other fixed-income accounts."

That's an especially bitter pill for retirees like Bukiet, who is of the generation raised during the Great Depression of the 1930s.

"The Depression taught us to live at a pace you can keep up, and I've done that," Bukiet said. "But to see how seniors, who have worked so hard and saved, now have to struggle, it just doesn't seem fair."

There are some steps people can take to try to increase their income, but many pensioners are hesitant to take them, financial planners say.

"Many would never even consider stocks," said retirement expert Ed Slott of Rockville Centre, N.Y. "They would still take the view, 'At least I don't lose any principal in the bank.' And that would be reinforced right now because they're scared about the economy."

Gary Schatsky, a financial adviser in New York City, says the decline in rates hasn't been as devastating as in the past because inflation is low, holding costs down.

"People on fixed income should be as concerned with inflation as with their rate of return," he said.

He added: "In addition, it's good news if it prompts people to focus more on their investment decisions."

Schatsky said that even older people should make sure they have a diverse asset mix.

"Maybe they need to move from bank CDs to money market mutual funds, or from funds to short-term, top-quality bond funds or to high-yield, insured CDs," he said.

Schatsky said that at the very least, people with fixed-income investments should be looking to lengthen maturities.

The current rate on 5-year CDs is about 4.5 percent, more than double the rate on certificates maturing in three months.

Even these modest steps, however, can be hard for those retirees who remember the stock market crash of 1929 and the Depression, said Sharon Luker, a certified financial planner in Plano, Texas.

Luker, too, suggests "moving a bit up the risk scale" by looking at things like collateralized mortgage obligations, or CMOs, issued by Fannie Mae and Freddie Mac; callable CDs, and real estate investment trusts.

"A lot of the older, conservative people don't want to take more risk, so they cut expenses," she said. "I hear all the time things like, 'Maybe I don't need cable TV anymore, or maybe I'll make fewer trips to the store to save gas.' Or they lower the thermostat and take fewer vacations."

Luker said some are taking part-time jobs to make ends meet.

"That's not necessarily bad," she said of retirees she advises who have found work as school crossing guards, greeters at Wal-Mart stores and ushers in stadiums.

"They have fun, they feel needed -- and they bring in more income," Luker said.

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