Part of the problem, says White, is that some retirement income products-particularly variable annuities-are complex beasts that many consumers find confusing and some advisors find irksome. "Advisors tell us they don't have time to keep up with all of the bells and whistles," she says.
But there has been a lot of innovation in the retirement income products space, White says. Some products, like target payout and absolute return funds, haven't caught on yet. Meanwhile, Cogent finds that variable annuity providers are coming out with simpler pricing and features.
Cogent's In-Retirement Income 2010 report surveyed 961 retirees and pre-retirees with at least $100,000 in investable assets.
Middle Boomers In The Middle Of Lots Of Things
In the world of the baby boomers, there are young, middle and older boomers who grew up in different times, were shaped by different influences and are in different stages of their lives.
The so-called middle boomers--those who are now 52 to 58 years old--have a lot on their plates. "On the financial planning continuum, this group, in their 50s, are very likely to be balancing significant family financial obligations with the need to plan for their own retirement," says Sandra Timmermann, director of the MetLife Mature Market Institute, which recently came out with a study on middle boomers.
The MetLife study found two-thirds of middle boomers have at least one living parent, and that 14% are providing care to an older parent. At the same time, half of them report having children still living at home. And 72% say they've been providing financial assistance to their children and grandchildren to the tune of some $38,000, on average, during the past five years.
On the assets front, middle boomers are in their peak earning years, but more than half (54%) say they're behind in their retirement savings goals. Timmermann says they're at an age when the need to grow their assets must be balanced against taking on too much risk.
Among the things financial planners can do, she says, is help these people find solutions-such as rebalancing their portfolios, for instance, or encouraging them to max out on their 401(k) plan even if other expenses seem to get in the way. Advisors can also help them choose financial products-annuities for example-that can shield them from market volatility.
"Advisors need to work with this group to make sure they are being realistic and are not in denial about the realities of a long life and the need to generate income for many years," Timmermann says.
Firms Struggle When Workers Don't Retire
(Dow Jones) As older workers cling to their jobs longer to make up for shrunken savings, employers are facing a new set of management problems-like how to make room for new talent.