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New Managers July 2017

MARKETING CHALLENGE: Diane Harrison: Boom or Bust? Are advisors ready for baby boomers to retire?

 

According to US census figures, Baby Boomers (defined as those born between 1946 and 1964) represent about 28% of the US population in 2017, and are currently between 53 and 71 years old. Give or take an error margin of several thousand, this translates to about 76 million people. This significant segment of the population includes both investors and advisors, raising an intriguing question: Just how prepared are we, investors and advisors, for retirement?

First, what are we all thinking?

Insured Retirement Institute's annual survey report, Boomers Expectations for Retirement 2017, reveals some interesting findings. First published in 2011, the year the leading edge of the boomer generation began to turn 65; the risks identified in the first report remain the same today: Boomers are under-saved, under-planned, have unrealistic expectations, and have an inadequate understanding of the risks they will face in retirement.

The full report goes into much detail about the attitudes and expectations of boomers. Some of the positive findings in 2017 include:

  • 4 in 10 boomers believe that selecting investment and insurance products, creating a financial plan for retirement, and planning for health care and long-term care require the help of a financial professional.
  • 85% percent of boomers also said they believe their financial planner is working in their best interest. They believe their advisors are professional and knowledgeable, with the most sought after attributes of a planner being experience (71%) and subject matter expertise (67%).
  • More than 7 in 10 boomers believe that the compensation their financial advisor receives is fair.

Some of the challenges also revealed:

  • Only 54% of boomers have retirement savings, the lowest recorded in the 7 years of the Boomer report.
  • 82% of boomers underestimate the percentage of their income that may be required to pay for health care.
  • At c......................

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    This article was published in Opalesque's New Managers a top-down monthly analysis, news and research publication on the global emerging manager space.
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