Financial advisors need to talk with clients about family issues that extend beyond finances, according to a study released today.
“This is no longer a world where an advisor can just be the best at financial priorities. He has to be the best at life priorities” to assist baby boomers properly, says David Tyrie, head of retirement and personal wealth solutions for Bank of America Merrill Lynch.
“Baby boomers have altered each stage of life they have entered and now they are facing retirement. We are seeing that family is going to be front and center,” adds Ken Dychtwald, founder and CEO of Age Wave, which researches the aging population and its impact on economic, social and cultural phenomena.
Merrill Lynch and Age Wave conducted the survey, which collected responses from 5,415 people 24 years of age or older.
A major finding from the study is that people are not talking about family issues that affect retirement. Financial advisors need to put themselves in a position to talk with families about health, home, work and leisure, Tyrie says.
“We are training our advisors to ask new and different questions when they go through the process of getting to know their clients,” said Andy Sieg, head of global wealth and retirement solutions for Bank of America Merrill Lynch.
Advisors also need to focus on the impact of the blended family on clients’ retirement, according to the study.
Sixty-eight percent of Americans over 50 are providing support for their adult children and 26 percent are helping to support grandchildren. The average support provided for other family members is $14,900, the survey says.
“People have shown they will sacrifice their own retirement to help family members," Sieg said. "Such admirable willingness to assist family members should not place one’s own long-term financial security in jeopardy, and can be a hidden risk to retirement that must be considered and planned for.”