Panel Says Advisors Should Ask Clients Tough Questions On Saving

He allowed that there are individual circumstances which may prevent some people from saving, but said advisors need to “help people ask the tough questions.” In his case, Daniher recommends that clients save at least a fifth of what they earn. It really comes down to the issue of whether “we need the direct TV and flat screens,” he said. “We all want things but the question is whether we want them now or later.”

Chris Cordaro, a certified financial planner with RegentAtlantic Capital, Chatham, N.J., compared controlling spending to a diet, noting that the formula is straightforward: “save more, spend less.” Saving in a tax efficient way is another solution to putting away more for retirement, Cordaro added, explaining that “tax is a huge enemy to saving.” Because of this, IRAs and 401(k)s become more important to the retirement plan.

Making people more aware of how long they will live, as well as how much they will need, will help make it easier to encourage savings, according to Neal Cutler, PhD., executive director of the Motion Picture & Television Fund’s Center on Aging, Woodland Hills, Calif. There has been a major shift in “wealth span,” Cutler noted, describing this as the part of the life span in which boomers are saving.

Because boomers have had families later, “there are fewer years to accumulate retirement savings which will have to last a longer period of time.” In order to help people see how their choices will affect their retirement, Laurence Greenberg, Jefferson National’s chief executive officer, said that a greater emphasis will need to be placed on educating consumers. For instance, he noted that there are some annuities that are good for consumers and some that are not, and education of both consumers and advisors is a way to differentiate products that can help secure retirement.