Individuals who work with a financial advisor double their retirement preparedness, according to a new survey by John Hancock Retirement Plan Services.
The new data, part of John Hancock’s 2015 Financial Stress Survey, show that of the people surveyed, 70 percent of those who work with a financial advisor are on track or ahead in saving for retirement. That compares with 33 percent of those not working with an advisor.
Among people who have an advisor, more than a third had determined how much to save for retirement and half had contributed to an IRA. For people without an advisor, only 14 percent knew how much they’d need for retirement. And 16 percent had contributed to an IRA.
“People need advice, not just investment advice but also basic retirement planning guidance,” says Patrick Murphy, president of John Hancock Retirement Plan Services. “And people need help with more holistic financial issues, such as budgeting and meeting short-term needs versus the need to save for longer term goals.
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“It’s very clear that engaging a financial advisor helps people take positive financial steps, from saving for emergencies to saving for retirement,” he adds.
The survey shows that 58 percent of people with an advisor had saved for emergencies versus 26 percent of people who don’t have an advisor. Within a 401(k) plan, 28 percent of those surveyed who have an advisor were saving the maximum allowed by law, versus 13 percent who do not.