|Targeted News Service|
Research showed an increase of clients who did not make significant changes to their retirement plans or lifestyles since the 2010 study. Planners report that 76 percent of retired clients did not make significant changes to their employment plans or lifestyles in the past 12 months. They also report that 66 percent of their clients who plan to retire in the next five years did not make any significant changes. These are both increases from the 2010 study in which planners reported that 60 percent of clients in or near retirement did not make changes in the previous year.
Of the 595 planners surveyed, three-fourths frequently or always use systematic withdrawal,38 percent frequently or always use time-based segmentation, a third frequently or always use essential-versus-discretionary income approach and 23 percent frequently or always use a less formal strategy where clients mainly live on their pension or
According to the study, planners always using the systematic withdrawal approach for generating sustainable retirement income were more likely to have less than five percent of their clients making a significant change. In fact, 33 percent of planners who always use systematic withdrawal had 96 percent or more of their retired clients make no significant changes to their employment status or lifestyle during retirement.
"The lifetime income methodologies that allow planners to be dynamic and nimble are gaining momentum in the practitioner community relative to those that are more static," said
"The results of this year's study are remarkable," said
"The FPA survey shows that financial planning strategies are improving, but we still have a lot to learn," said
Although 78 percent of survey respondents said they select a retirement income strategy and use products to implement that strategy, some planners seek a single product to accomplish successful retirement income planning. The respondents suggested the following improvements for retirement planning products:
Automated products–for example, a product that allows clients to automatically take income out of the fixed-income portion of the portfolio;
More transparent and affordable annuities–Planners say they want more annuities with no fees, no commissions, and low expenses;
More innovative LTCI/annuity products–Planners are looking for hybrids that offer enhanced payments for terminal illnesses and tax advantages typically associated with LTCI.
For more research findings, FPA members can download a free copy at www.FPAnet.org/Professionals.
Journalists: To obtain a copy of the research for reference, please send your request to Christine.Richardson@FPAnet.org.
TNS 23nq 111202-3699348 61NaushinaQamar
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