Most clients are concerned about their financial stability in retirement, says a new survey of 200 investment advisor representatives at RIA firms.
The 2023 RIA Protected Accumulation + Retirement Income Survey, conducted by RetireOne and Allianz Life Insurance Co., provides insights into the concerns and planning strategies of RIAs and their clients regarding retirement income planning and portfolio protection.
Highlights from the findings include:
- Inflation and Benefit Concerns: A whopping 97% of advisors surveyed say clients have voiced anxieties about how inflation might reduce their retirement savings. Furthermore, 85% said clients expressed doubts about the sufficiency of their Social Security benefits, while 63% worried their employer-backed retirement benefits might not be enough.
- Lower Returns Forecasts: Many advisors anticipate that future investment returns might lag behind historical averages. This has led to doubts about the traditional advice of withdrawing 4% of retirement savings each year.
- The Role of Annuities: Over half of the advisors surveyed mentioned they incorporate annuities into retirement plans for consistent income or as a safer alternative to other investments. However, there’s also a lack of understanding about the newer, more transparent annuities that don’t involve hefty fees or complex terms.
- New Strategies for Advisors: The survey suggests that investment advisors might benefit from partnering with specialized insurance platforms, which can offer improved annuity solutions without the need for an insurance license. Such collaborations can enhance asset management and firm valuation.
David Stone, the CEO of RetireOne, commented on the findings, noting the challenges posed by increasing interest rates for investors. He said, “On the bright side, the conditions have improved the guarantees and benefits of annuities, making it more affordable to establish reliable income streams for retirees.”
The study was carried out in May 2023. For a more comprehensive look at the survey and its results, visit RetireOne’s website.