While affluent investors’ priorities have shifted, says Sallie Krawcheck, president of Bank of America Global Wealth and Investment Management, there is “underlying anxiety about issues that are going to affect their financial well being.” She spoke of the findings in an April 20 conference call discussing the findings of the “Merrill Lynch Affluent Insights Quarterly,” a survey of affluent Americans–deemed by Merrill Lynch as those with more than $250,000 in investable assets.
Krawcheck also noted that there have also been “upticks in concerns about rising healthcare costs and the impact they could have, but also on ensuring that retirement assets will last throughout one’s lifetime.”
Healthcare and assets
Healthcare was a “top concern” for 62% of study participants, with 52% of those uncertain of the impact of rising healthcare costs in planning for retirement.
In addition, 73% of “affluent baby boomers” in the 51 to 64 age range were “most concerned about whether their assets will last throughout their lifetime,” and 40% of them “expect to retire later than they did one year ago,” according to the survey results.
More than half of the participants, 52%, “believe that more could be done to assist individuals in their retirement saving efforts.” Half of those “believe that health care coverage should be provided to all retirees,” and 44%, “believe that more financial resources should be put toward Social Security.” However, of the participants in the 35 to 50 age group, 47% believe that “Social Security will not play a role in their retirement,” and 70% think that Medicare “will play little to no role in offsetting medical expenses during their retirement years.”
Slightly more than two-thirds, almost 65% of the under-50 crowd of those surveyed, would like limits on IRAs and 401(k)s lifted.
Affluent investors working longer
In the over-65 age group of affluent investors in the survey, 67%, “appear to be working longer and approaching retirement practically and altruistically–focusing most on spending more time with family and friends.” In this group, 45% plan more time for “philanthropic endeavors,” and the same percentage plan to travel during retirement.
Almost half, 44% of those surveyed, work with a financial advisor, with 13% of them “engaging with” their advisor weekly, 41% “at least monthly,” and 75% “at least quarterly.” Of the 56% of participants who did not have an advisor, 25% of them “believe they would benefit from such a one-on-one relationship.”
Comments? Please send them to email@example.com. Kate McBride is editor in chief of Wealth Manager and a member of The Committee for the Fiduciary Standard.