Are baby boomers at long last beginning to feel anxiety about how they will arrange for retirement income and related matters?

Michael Thompson, in advisor programs at Transamerica Retirement Management, St. Paul, Minn., thinks they are.

So do other advisors, meaning advisors may finally be able to ease up a bit on trying to make boomers aware of retirement realities. Now, they need to focus more on addressing that anxiety in productive ways. Some ideas follow.

“Ten years ago, the stock market was booming and baby boomers were all about accumulation, with no end in sight,” recalled Thompson, a former advisor. Back then, boomers did not show much concern about transitioning into retirement, he said.

But today, retirement concerns are evident. For instance, in one TMR focus group, consumers were asked what they plan to do with the money they’ve accumulated for retirement.

The response was “shocking,” Thompson said. “There was dead silence. The people in the room were very uncomfortable. Some were shifting in their seats or looking at each other. This continued until the session leader stepped in to nudge them along.”

The focus group consumers didn’t know what they would do, he said.

That tracks with what J. R. Thacker is seeing. Today’s boomers are not necessarily panicky, but they are definitely worried or concerned, said the president of Thacker & Associates, Bristol, Va.

“It’s not uncommon for new boomer client to come into the office asking, point blank, how much will this give me in retirement?” Thacker pointed out.

These boomers tell Thacker that they want “as much money as possible” for their retirement. Then, he said, they ask “will this last me the rest of my life?” Some also ask, “will inflation hurt me?” Or, “will a big loss in the equities market restrict my income or cause me to run out of money?”

All of this revolves around maintaining lifestyle, he surmised. “Boomers keep asking, ‘will my income stay the same?’”

He attributes this concern not only to the fact that boomers are nearing retirement age, but also to the fact that they’ve seen retired family members and friends suffer losses, cut back on retirement income withdrawals, and even go back to work.

They are also seeing parents who live longer to the point of outliving their money, added Wayne Maslyk Jr., co-founder and vice president of Great Lakes Benefits & Retirement Group, Sandusky, Ohio. “Or they see parents struggling to find the money to pay the prescription drug costs.”

“And some are rearing their grandchildren, so they are spending money there that they would otherwise be saving for retirement,” he said.

For whatever reason, boomers have finally “heard the wake-up call,” concluded Maslyk.

Like Thompson, Thacker has noticed something “shocking” in all of this: “Many boomers say, ‘I want to draw as much income as I can until I’m 65 (assuming they retire before then), so I can do all the things I want to do. Later on, I’ll be content to stay home, not travel, etc., so I will draw out less at that time.”

That’s shocking, Thacker said, because it goes against inflation. “We need to educate them on what the future will likely be like, say, at age 75 or later.”

What about desire to leave money to the children? “They said, ‘if money is left over after we die, that’s fine.’ But they’re not worried about this at all.”

Their chief worry, he reiterated, is having enough money in retirement for themselves.

Hence, falling portfolio values make boomers “very anxious,” he said.

Maslyk sees the same. In the 1990s, boomers would take a lot of risks with their money, he recalled, citing “knee-jerk trading” as an example. Some still do that, he said, but many others are now much more cautious.

To illustrate, Maslyk named the top concerns among the salaried workers whom he advises: Fear of losing a pension they had expected or having that pension reduced; worry about reductions in their health insurance benefits; concern that their spouse will be unable to get health and life benefits; and concern about erosion or loss of Social Security benefits.

Downsizing, forced early retirement and losing money are also on his list.

“Some are realizing they don’t have much money saved up at all,” said Maslyk. Those people are worrying if it’s too late to do anything about retirement. “Some decide they’ll just wing it, roll the dice,” he said.

Though individual situations differ, he continued, most boomers generally “want to keep on saving, are less interested in investing riskily, and want to be sure they have enough saved up in their nest egg to maintain their standard of living, even if their pension gets cut.”

Many younger boomers “don’t even want us to include Social Security in the plan projections. They don’t feel it will be there for them, as it is today,” Maslyk said.

Boomers are increasingly aware that they have to take on more responsibility for their retirement as they move into the third age of life, said Phillip Eckman, CEO of Transamerica Retirement Management, St. Paul, Minn.

They are realizing that traditional pensions and retiree health benefits are going away, even as boomers develop bigger dreams and to-do’s for themselves, Eckman said.

Boomers do seem to feel good about the fact that they are saving more and building a nest egg, he said. “But when you press them, asking how they will put it (their money) to work, to live the life they’ve been dreaming of, there is a void.”

It’s that void that TRM seeks to fill, he said. A new business unit of Transamerica, TRM is initially available as an option in 401(k) plans. It offers solutions and education programs, such as broad, open architecture brokerage services (with tools, but no commissions or advice); true advisory services (phone-based, by trained salaried advisors; among other things, includes annuities and systematic withdrawal from mutual funds); and insurance products (long term care, life insurance and MediGap, initially).

A one-size fits all approach does not work, Eckman said in explaining why there are various options.

Boomers “need education and information for this transition time,” he stressed. “They have to have the conversation….They need help with understanding their choices.”

Transitioning into retirement is a process, he added. It entails moving from asset allocation to product allocation. “Boomers need to learn how to take what they have and allocate it to the right place, from a retirement security standpoint.”

To address the concern, advisors should answer the boomers’ questions and give them some solutions, too, suggested Thacker. For instance, when they ask about what will work, nudge them to follow a more conservative plan than like taking out 10%-12% a year.

Boomers who are still heavily invested in equities may not even realize it’s important to become more conservative as they move into retirement, he continued. “They’ve seen bull markets in the 1980s and 1990s, and, although they’ve also seen big drops, the market has always swung back. But they really don’t remember experiencing an extended bear market like the one in the 1970s, so the advisor needs to educate them.

“Some boomers seem a little surprised when we start talking about becoming more conservative, but after a while, it starts to make sense to them.”

Another suggestion: Run the numbers for the boomer, said Maslyk. Give some practical advice too, he said, “such as saying to them, when appropriate, ‘hey, stop helping out your kids so much’ or ‘go out and get another job.”

“Or, if health insurance is a worry, maybe suggest that they go get a job that offers health insurance.”

Keep in mind that people will need different kinds of solutions, said Eckman. Boomers with assets of $250,000 to $1 million “can’t afford not to have some kind of longevity solution. They can’t self-insure. They need to have income over the next 30+ years.” Even people with more modest assets need to have the conversation, he said. “We need to at least help them see an income stream with the assets they do have, so they can make better choices.”

The process needs to look beyond financial planning, added Thompson. “We need to look at the whole of life for the boomer, and be advocates for them….Take a holistic approach.”

When boomers are feeling anxious, don’t scare them further, he suggested. “Rather, educate them, give them options, and help them see how to make the transition. Also provide the boomer with resources to others who can help in areas where the advisor is not an expert.”