|Donald Jay Korn|
U.S. investor optimism fell to minus-8 in November, down sharply from a plus-24 reading in May, according to the
“The findings are eye-opening for financial advisors because investors are clearly saying they are worried about the economic situation,” said
To put the current index level in perspective, the index had a score of 124 at inception in
The overall drop in confidence shows up in investors’ concerns about their personal futures. Among the respondents to the recent survey, 69% said they are “somewhat” to “extremely” worried they will outlive their savings in retirement. Similar worries were expressed about a large reduction in their standard of living during retirement while 56% fear they will be forced to work during “retirement” to maintain their lifestyle.
Such anxieties may be reduced by successful investing. “People need help saving and advisors can play a key role in filling their clients’ needs by working with them on a sound financial plan,” Ready said. He noted that when the poll asked investors to rank the level of responsibility for teaching Americans to save, 67% pointed to financial advisors, right behind parents/family and individuals on their own. In the latest poll, 76% of non-retired and 72% of retired Americans said having a financial plan with specific goals and targets gives them confidence they’ll meet their financial goals.
Judging by some of the other responses, advisors may have to be persuasive in order to convince investors to hold a well-rounded portfolio. Among survey respondents, 68% said they have “little to no” confidence in the stock market as a place to invest for retirement.
Nearly half (45%) of those polled say they have reduced their investments in the markets; of those who have pulled money out of the market, 67% of those investors said they have no regrets about doing so over the past four years, even after a bull market since early 2009.
|Copyright:||(c) 2012 Financial Planning. All rights Reserved.|
|Source:||Source Media, Inc.|