RETIREMENT PLANNING SURVEY

Clients ’ fears about retirement haven ’ t changed , but advisors see the bigger picture .

By Jennifer Lea Reed

“ It ’ s not surprising to see that retirement comes ahead of wealth accumulation , because pretty much everyone can see themselves retired , but not everyone can see themselves accumulating significant wealth and needing support in managing it ,” says Mat Powers , vice president of strategic retirement solutions at Commonwealth Financial Network .

To illuminate the contemporary shifts in client expectations and add to the industry ’ s understanding of just how important retirement planning is to an advisor ’ s business , Financial Advisor conducted a retirement survey of 376 advisors , 68.09 % of whom have been in business more than 20 years .

Aside from retirement planning and wealth-building , these advisors say comprehensive financial planning — including estate planning and tax planning — is the third-most-common reason that a client starts an advisory relationship . The mean client asset minimum of those surveyed was approximately $ 760,000 , and 59.31 % said their retired clients have between $ 500,000 and $ 2 million in saved investable assets .

With such minimums , it ’ s not surprising that pre-retirees and retirees often can be the bulk of an advisor ’ s practice . Some 46.54 % of the survey takers say that 61 % to 80 % of their clients are 55 and older , while 31.65 % say 41 % to 60 % of their clients are . Another 13.03 % of advisors say 81 % or more of their clients are 55 and older .

Clients And Advisors Are Afraid , For Different Reasons

These clients have unique needs depending on where they are in their lives . People of all ages can worry about a stock market crash , the cost of healthcare and inflation , or having to support adult children . But advisors say a little more than 38 % of their pre-retiree and retiree clients are most afraid of outliving their assets . The top concern for another 31.92 % of clients is generating a reliable income stream .

That fear of running out of money can actually keep them from spending as much as they need to , says Sal Capizzi , executive vice president at San Diego-based Dunham & Associates Investment Counsel . “ And that is sad because they ’ re not doing some things that they should be doing in retirement . It ’ s so ingrained in their head : ‘ Be careful when you retire ; don ’ t overspend , you ’ re going to run out of money .’ And that ’ s their fear .”

Advisors with more than 20 years ’ experience pretty much have seen it all , and their assessment of what their clients should really be worried about is a little different . From their point of view , the number one threat to clients is unanticipated healthcare costs , something named by 54.52 % of advisors in the survey . Outliving assets came in second , with 38.83 % of the advisor vote .

DECEMBER 2024 | FINANCIAL ADVISOR MAGAZINE | 45