I’ve said it before, and still believe, that our annual feature article on retirement is our most important of the year. Our top advisors ranking in December may be more fun, even for us, but the retirement topics we cover are crucial for you and your clients.
Associate Editor Margarida Correia illustrates various ways advisors can help their clients pay for the care expenses stemming from a longer life. Read her cover story, which cuts to the heart of what ails us financially and emotionally, to learn some of the innovative approaches advisors are using to finance clients’ increasingly long retirements.
The strategy of simply working longer has been touted for years by financial prognosticators. Some benefits are easy to grasp, like more paychecks and higher Social Security benefits when retirement finally kicks in. Others aren’t so easy, like staving off required minimum distributions from your 401(k)s beyond the age of 70 ½, which is the topic that contributor Dave Lindorff explores in his article.
That said, the average retirement age is still 62 for women and 64 for men, according to a report earlier this year from the Center for Retirement Research at Boston College. Some of those people, no doubt, retired for health reasons or job losses. But when Gallup asked working Americans last year when they planned to retire, the average answer was just 66. So the message of working into your 70s is not resonating with many pre-retirees.
That, as well as other recent research from TIAA-CREF shows the dire need for advice. For example, one chart on our data page shows a large portion of investors saving just 3% or less of their income for retirement. And there’s not a major difference in the various age groups. For those 18-34 and 35-44, four in 10 are saving less than 3% of their income. Older investors aren’t much better; for those in the 45-54 and the 55-64 age groups, 38% save that little.
All this points to a big opportunity for nimble advisors. That’s why I’m saying—as I did last year—that this feature article is our most important of the year. And it will be next year. Make sure your clients know what they need to know.
- Advisors: Your Job Is Getting Harder
- From the Editor: Investors Repeating Same Mistakes
- Hidden Benefits to Clients of Working Longer