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My Favorite Retirement Tool

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When I look around my office, I see a lot of physical objects that can help individuals plan for retirement: pens to draft a budget, notebooks to help document expenses, and folders to save receipts and other financial documents. One item I use on a regular basis is a set of digital retirement calculators posted by my group, the Indexed Annuity Leadership Council. This set of calculators helps me stay on track with a balanced and effective financial plan.

(Related on ThinkAdvisor: 10 Alarming Facts About Women and Retirement Risk)

With one in four baby boomers having less than $5,000 saved for retirement, it’s vital for your clients to be cognizant of their financial future. There are a lot of online calculators out there, but this set of 10 calculators is great at helping agents pinpoint their client’s needs: anything from estimating Social Security income to tax advantages of annuities. My personal favorite is the saving-for-retirement calculator. With a series of quick, pointed questions, this calculator can get you to the heart of the conversation with a client looking to improve their retirement savings game.

Additionally, you can use these tools to help your clients calculate their propensity for risk and see how external factors like inflation may influence a savings plan. With one child in college, another about to go to college, and a third child who is special needs, planning is key to my own family’s future.

Eventually, for example, we would love to spend our retirement at the lake, or close to my parents in Arizona. I am always running different scenarios and looking for variety and balance in my plan, and I urge others to work with financial professionals to do so as well.

Here are a few tips to share with your clients once they receive their calculator results: 

They may seem obvious to you, but, remember: The importance of a baby boomer having more than $5,000 in retirement savings also seems obvious to you. What seems obvious to you might not be obvious to the client.

  1. Explore employer offered savings options. Your clients need to understand that refusing to take the employer’s 401(k) matching contribution is like leaving money on the table.

  2. Re-shift thinking on Social Security. About two out of five baby boomers have unrealistic ideas about how much they’re likely to get from Social Security. Help clients understand that Social Security will probably be just one piece in their savings puzzle, not their main source of income.

  3. Balance things out. When you are talking about diversification, that can be a good time to explain how a fixed indexed annuity can help secure guaranteed lifetime income. This product can increase the sustainability of the client’s financial future, by mitigating external risks. The market may swing, but the client’s principal will be protected.

— Read NAIC Tees Up on Annuity Suitability Models on ThinkAdvisor.


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