Advisors are falling behind in helping their aging clients prepare for what could likely be one of their most costly expenses in retirement: where to live, according to a just-released study by Legg Mason.
Legg Mason recently collaborated with the Center for Innovative Care in Aging at the Johns Hopkins School of Nursing to create a new Planning for Housing advisor education program.
A new survey of 506 financial advisors by Legg Mason found that only 14% of advisors have helped their clients develop specific plans to address their future long-term housing needs, such as downsizing, moving to a retirement community or preparing for advanced care. This lack of focus on their clients’ housing needs in retirement comes despite the fact that nearly half of the advisors surveyed (45%) said they have “personally considered other housing options” for their own retirement.
The advisors polled said that the primary reason they have not helped their clients plan for their housing in retirement is because “My clients do not ask about it,” while 26% of the advisors who have not helped clients plan for housing in retirement said they do not feel “knowledgeable enough about the topic” to address it.
Not planning for clients’ housing needs in retirement takes a backseat to what advisors listed as the top three “aging” challenges that they do focus on:
- Having enough money in retirement (65%)
- Wealth transfer (34%)
- Plans for retirement, e.g., their “bucket list” (24%)
“Planning for the financial implications of housing choices should become a much higher priority for aging investors and their advisors,” said Kathleen Pritchard, managing director, head of Advisor Business Development at Legg Mason, in a statement. “Every decision around housing has significant economic implications.”