The Future of Retirement Income
In November, 2009, “Think Advisor” – an online resource for financial professionals published an article called “The Future of Retirement Income.” The article pointed out that in a post-market-crash world, too many advisors lack the skill set, the competence or even the interest in providing appropriate retirement advice.
This is why you might consider working with someone who actually does have the ability, the experience and the willingness to spend the time necessary to properly assist your retirement planning process; especially in the area of creating an efficient way to obtain lifetime income.
Here are some excerpts from the article:
- According to survey after survey, anxious investors are clamoring for retirement planning guidance. A research study this past summer by Cerulli Associates found advisors continue to exhibit “ambivalence” toward retirement income planning.
- The topmost obstacles cited by advisors to providing retirement income support: lack of consumer awareness and the fact that it is time-consuming.
- Meanwhile, a survey from Spectrem Group says many financial advisors are unprepared for retirement planning and dated in their knowledge of products and strategies.
- “It’s just not what advisors have been trained to do. Yes, most are unprepared,” notes Francois Gadenne, executive director of the Retirement Income Industry Association.
Consider these findings:
- SRI Consulting Business Intelligence in February returned to households it had surveyed between April and August 2008 and learned that one-half of all households’ expectations for retirement had changed since September 2008.
- Thirty-seven percent said they had lower expectations for how they would live in retirement, and nearly 25 percent said retirement was no longer an option for the foreseeable future.
- And Merrill Lynch Wealth Management’s “Affluent Insights Quarterly” survey, released in October, found that 50 percent of respondents felt that their current retirement plan was an area of “high” concern. Their foremost worry: the risk associated with rising health care costs.
- The broader overarching question for the industry is: Has risk tolerance fundamentally changed?
- In a Spectrem Group survey last December, 90 percent of investors with $500,000 and above in net worth, not including their house, called the economic crisis the biggest financial event of their lifetime.
- The issue for advisors is how quickly can they adjust to the post-crash world. The issue for retirees, is how do they find the right kind of help in achieving their retirement goals?