December 8, 2008

Advisor survey finds client retirement severely off-track

Advisors say their clients projections for retirement security have been "severely jeopardized," according to survey results from Brinker Capital's year-end Retirement Indicator, which gauges the response of more than 200 advisors affiliated with insurance companies, independent broker/dealers and those in sole practice.

"At the start of this year, fully 46 percent of our financial advisor respondents said their clients were still on track to a timely retirement. By the end of the year our advisors and their clients had a much bleaker picture of retirement: 88 percent of advisors now say their clients are off-target for a timely retirement, largely due to market depreciation," said John Coyne, president of Brinker Capital in a press statement today.

As compared to a decade ago, 88 percent of advisors said their clients are off-track to a "timely" retirement; 74 percent said it would take one to five years to make up for the shortfall. Top reasons for being off-track included "market depreciation" (97 percent); "didn't start saving soon enough" (51 percent); and "general procrastination" (47 percent).
Other findings from the survey include:

  • Sixty-five percent of advisors noted that their clients "have become more vocal/involved in the investment process," whereas 31 percent said their clients "have stayed neutral about their involvement in the investment process." Only 4 percent of advisors indicated their clients are now "less vocal."
  • Forty-four percent of advisors are seeing an increase in clients tapping into their retirement savings to provide liquidity for the near-term, versus 56 percent who have not experienced liquidation.
  • When asked if they believe that the proposed full fee disclosure regulations (with respect to qualified plans) are needed, 67 percent of respondents said "yes."
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