Thu, Apr 24, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Cerulli: Households with $100k-$500k in investable assets are sweet spot for asset managers

Wednesday, October 10, 2012
Opalesque Industry Update - According to The Cerulli Edge-Retirement Edition, 3Q Issue, most households with between $100,000 and $500,000 in household investable assets for retirement have not developed a formal retirement income plan or engaged with a financial advisor.

"This finding is a significant concern because that means some investors are entering retirement without an income plan for the next 20 plus years of their lives. In addition, we found that many retirees in the $100,000 to $500,000 asset range are not working with a financial advisor," explains Tom Modestino, associate director at Cerulli Associates.

"The silver lining is that this represents a great opportunity for asset managers, broker/dealers, and retirement plan providers to increase retirement income planning education, guidance many investors will welcome. This lack of planning can result in rollover opportunities after retirement," notes Alessandra Hobler, analyst at Cerulli.

Interestingly, Cerulli points out that the few investors who are working with a financial advisor were not likely to move or switch their assets to another advisor.

Of those households with less than $500,000 in investable assets, concerns are more strongly centered on cash flow. Asset managers may develop relationships with these households by offering budgeting tools and educational information on Social Security.p> Cerulli also found that investors with between $500,000 and $2 million in investable assets were more prepared for retirement and many were working with an advisor. And, investors who fell within this income range were found to be more likely to switch assets to another advisor. This is likely due to the fact that once these investors enter retirement, they look for an advisor with strong, established retirement income planning services.

"Preparing for retirement can be a difficult task. Investors spend most of their lives saving and accumulating assets in order to generate future retirement income," Hobler points out.

Other findings:

Although pre-retirees should be a primary target for advisors hoping to provide retirement income planning, more than half of retired investors do nothing in advance of retirement.

While investors in their fifties are likely to report that they have not gotten around to consulting an advisor, investors in their sixties are likely to say they do not need retirement advice. Therefore, the sweet spot for asset managers to target with the message of retirement income is investors in their late fifties.

Though relationships between providers and investors are formed through the retirement asset accumulation stage, for firms that have not had the opportunity to work with investors at this stage there is still the potential to garner rollover assets at the time of retirement.

(press release)

These findings and more are from The Cerulli Edge: Retirement Edition, 3Q 2012 issue: external.cerulli.com/file.sv?00026M

Click here to request a press copy of this research.

Bg

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Banner
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing
  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. …And Finally – Flight attendant has passengers rolling in aisle[more]

    From Orange.co.uk: A video of a US flight attendant turning her safety talk into a comedy routine is proving a huge hit online. More than five million people have watched the clip of Marty Cobb which has her passengers rolling with laughter on a Southwest Airlines flight to Salt Lake City.

  2. Niche Investing – Wealthy investors flock to fine art funds[more]

    From Clickorlando.com: Wealthy investors looking to diversify beyond stocks and bonds are now turning to an unusual money-making vehicle -- the art investment fund. The name says it all: These funds invest in fine art and seek returns by acquiring and selling high-end pieces for profit. Growth

  3. Opalesque Exclusive: Rainwater and Blue Sky - an Australian water fund emerges[more]

    Bailey McCann, Opalesque New York: Financial reporters often tout new funds and investments as uncorrelated investments, but few can say they are uncorrelated to everything but weather. Enter Blue Sky Alternative's water fund which invests in the permanent rights to Australia's water. Sev

  4. University of Michigan allocates $242m to six managers[more]

    From PIonline.com: University of Michigan, Ann Arbor, invested or committed a total of $242 million to one traditional equity manager and five alternative investment funds from its $9 billion endowment. University regents approved the hire of Mittleman Investment Management to run $35 million in act

  5. Performance – Odey flagship hedge fund suffers brutal March as shorts rise, Blackstone first-quarter profit rises 30% on higher fees[more]

    Odey flagship hedge fund suffers brutal March as shorts rise From Valuewalk.com: The tide has turned for the worse for one of Europe’s best performing hedge funds. Crispin Odey’s flagship hedge fund, Odey European has suffered a 4.63% decline for the year after slipping 7.2% in March, ac