RICP Becomes American College’s Top Designation Program

“After the process course we go into much more depth on some of the different parts, including Social Security, long term care planning, how to build a retirement portfolio, how to take withdrawals out of a portfolio,” Littell notes.

There are no prerequisites for the RICP program, Littell explains. But he said advisors that have advanced credentials such as the Chartered Financial Consultant (ChFC) or the Certified Financial Planner (CFP) designations are finding the program to be especially helpful.

Littell notes that the RICP offering also comes at a time when Americans are struggling with the challenge of retirement income planning. As evidence, he cites findings from the college’s recent Retirement Income Literacy study, which was profiled recently by Retirement Wire:

• Just 20 percent of retirement-age Americans can pass a basic quiz on how to make their next eggs last through retirement.
• Seven out of 10 Americans are unfamiliar with the “4 percent rule” for a safe withdrawal rate in retirement.
• Only half (53 percent) know that it is best to wait until age 70 to claim Social Security
• More than half of Americans (51 percent) underestimate the life expectancy of a 65-year-old man.
• Only 27 percent of respondents said they have a written retirement income savings plan in place, even though 63 percent said they have a relationship with a financial advisor.

Filling a Training Void

Part of the RICP program’s popularity may be due to its uniqueness. Littell explains that when the college first began discussing the merits of a retirement income planning offering, “There was a clearly identified need, and there wasn’t really anybody filling that space.”

“We did a survey of advisors before we started this and what they reported was that they wanted a process for building a retirement income plan,” Hopkins says. “Before we started the program, we also had an industry group that [met] and talked about all the competencies required – all the things that [retirement planners] needed to know in order to do a good job.”

The result was curriculum focus on several key topics: “long-term care planning, healthcare planning, and different strategies for converting assets into income,” Hopkins says. “We include a lot on Social Security claiming; a lot on choosing pension distribution options; we talk about ethical issues when working with older clients; we discuss all the research about the 4 Percent Withdrawal Rule; and how does asset allocation affect how much you can withdraw.”

“We also cover strategic use of home equity,” Hopkins continues. “There is quite a bit on reverse mortgages — in part because there is more and more research showing that you can use a reverse mortgage strategically; not just as a last resort, but as a strategic part of your retirement income plan. You can use it as a line of credit, and there are some studies that show you might be better off taking it earlier. Some of the research supports that, although a lot of people have very strong feelings about reverse mortgages, and some of it very negative.”

Early participants in the program have reported finding the Social Security training to be especially valuable, Littell says.

But perhaps the program’s greatest offering is to expose financial advisors to different schools of thought on how to best manage retirement income.

“We are in a field where some people are focused in on building an income floor and then having a portfolio with discretionary income needs; and other people think you should just keep all your assets in a portfolio,” Hopkins says. “We have a number of different ways of looking at in and these people in these various camps are pretty sure that they’re right. You learn about all these different approaches, and I think people like that.”