LIMRA’s 2015 Retirement Conference, April 15-17 in Arlington, Virginia, was a great opportunity to pick up new ideas and learn key information about retirement and the most pressing retirement issues.
On the following pages, I’ve included ten key takeaways from the conference.
1. Income strategies need balance
Don’t get too caught up with strict analytics when researching clients, according to Judith Zaiken, corporate vice president and director LIMRA Secure Retirement Institute research.
“The most effective retirement income strategy is actually a subjective assessment as much as it is an objective one,” said Zaiken.
“A subjective assessment combined with a thorough look at the numbers can help an advisor develop a more effective retirement income strategy,” she said.
2. Wealthy Americans fit into three distinct categories.
Guarantee seekers – Have a floor of lifetime guaranteed income and would be interested in converting even more of their savings to a pension-like contractual guarantee.
Estate planners – Want to maintain personal control over investment decisions and to retain the flexibility to adjust income and spending as needs change over time.
Asset protectors – Will live off the interest and dividends of savings, but uncomfortable invading principal.
3. Clueless consumers
Millennials are the most clueless demographic with only 30 percent of them knowing how much they should be saving. Boomers and Generation X aren’t much better with only 40 percent of folks having a clue about their savings needs.
“Not surprisingly, our study found that the majority of Americans — no matter their generation — are not confident that they will be able to achieve the retirement lifestyle they desire,” said Cecilia Shiner, associate research director, LIMRA Secure Retirement Institute. “If consumers aren’t confident that they are doing the basics correctly — like saving enough for retirement — it is unlikely that they will be confident of their retirement prospects.”
4. Baby boomers need to save more
“With 7 in 10 pre-retirees reporting that their Social Security and pensions will not cover their basic living expenses, it is concerning that more than half of boomers have less than $100,000 saved for retirement and more than a third have less than $25,000 saved for retirement,” said Cecilia Shiner, associate research director, LIMRA Secure Retirement Institute.
5. Are you authentic?
According to a session at the Retirement Conference, advisors should ask themselves the following questions before talking to a client?
- Are you easy to understand?
- Are you down to earth?