Page 20 - Investment Advisor June 2022

RETIREMENT PLANNING

HER ADVISOR MISSED AN didn’t know about the closed loophole. Practical Achievers will prioritize finan-
OPPORTUNITY More frustrating to Barb, “Our finan- cial security more than their peers. They
There is no splitting or choosing benefits cial advisor never talked to us about my will continue to place importance on digi-
when born after Jan. 1, 1954. Barb’s big Social Security.” tal investments and currencies, exten-
sister happens to be four years older, Either the advisor doesn’t know enough sively research their assets, stay abreast of
born in 1952. So, Georgia was in fact eli- about Social Security to help, or they macroeconomic trends and invest evenly
gible for the restricted application. She missed the opportunity to offer impor- in stocks and cryptocurrencies.
claimed spousal benefits first, and recent- tant, critical retirement income advice.
ly switched to her maximum benefit at How Barb decides to address this may 2. ON-TREND FRIENDS
age 70. Her advice was sound; she just turn out to be a problem for the advisor. Comprise 13% to 23% of future retir-
ees: 9.4 million to16.6 million millen-
nials. Driven by purchasing power and
Prepare for These 4 Types of close attention to all things culturally
relevant, On-Trend Friends will priori-
Millennial Retirees, Says Schwab tize keeping up with the latest con-
sumer trends and spend more time and
money on shopping than their peers.
illennials have started saving for ing techniques that group generations to They value financial security as a way to
Mretirement in their mid-20s, a forecast future attitudes. maintain a healthy spending and enter-
decade earlier than baby boomers, yet tainment budget.
they are expected to spend less time SHIFTING VALUES IN RETIREMENT
managing their personal finances and The study found that a key difference in 3. RELAXED MINIMALISTS
investments once in retirement, com- how millennials expect to live in retire- Comprise 31% to 41% of future retirees:
pared with boomers or Generation Xers, ment compared with previous genera- 22.4 million to 29.6 million millennials.
according to a study released in April by tions is rooted in the value they place on Equally satisfied by the company of
Charles Schwab. having more flexibility and new experi- their inner circle and the simple plea-
Not only that, millennials will be ences in retirement, whereas boomers sures of their daily routines, Relaxed
more likely to use savings to achieve value stability and consistency. Minimalists more than other perso-
their dream lifestyle and pursue their The study predicted that three-quar- nas will value deep relationships. They
passions on the way to and in retire- ters of boomers and Gen Xers alike will will focus less on finances and devote
ment, whereas their older counterparts’ enjoy stability through homeownership more time to hobbies, relaxation and
goal will be to continue accumulating in retirement. But 61% of millennials “me time.”
wealth in retirement. will prioritize travel, with only 48%
These findings emerged from predicted to own a home in retirement. 4. HIGH-TECH JETSETTERS
Schwab’s Retirement Reimagined Study, Boomers also maintain a more tradi- Comprise 24% to 34% of future retirees:
which uses advanced predictive model- tional approach when it comes to financ- 17.3 million to 24.5 million millenni-
ing techniques to forecast key differ- es. Focused on financial security and als. High-Tech Jetsetters are nomadic
ences in how millennials, Gen Xers and traditional investments, 48% of boomers and fast-paced. In retirement, they will
boomers will approach saving for and invest in stocks, while a mere 5% of older prioritize travel and be more open to
living in retirement. investors put money into digital curren- long-term travel than their peers, trust-
The study also projects four distinct cies. In contrast, 24% of millennials and ing technology to keep up with family
retirement personas that millennials 19% of Gen Xers said they plan to invest and friends. Their curiosity, tenacity and
could fall into as many of them transi- in digital currencies in retirement. commitment to the latest gadgets will
tion to retirement around 2050. Here are the four distinct personas carry through into retirement.
The Schwab study’s findings and Schwab says millennials could fall into
future personas are based on three major in retirement. Marcia Mantell is the founder and presi-
components: a quantitative survey of dent of Mantell Retirement Consulting Inc.,
5,000 Americans, in-depth analysis of 1. PRACTICAL ACHIEVERS and blogs at BoomerRetirementBriefs.com.
Schwab data alongside third-party mac- Comprise 12% to 22% of future retirees: Michael Fischer is a regular contributor to
roeconomic data and advanced model- 8.7 million to 15.9 million millennials. ThinkAdvisor.com

18 INVESTMENT ADVISOR JUNE 2022 | ThinkAdvisor.com