Have you noticed you are getting more questions from your clients about rollovers and Social Security?

According to a Pew Research Center study, four times as many baby boomers retired between February and September of 2020 than did during the same period in 2019. That’s 1.1 million baby boomers who retired last year. Only 250,000 boomers retired the year before. To further underscore this shift, a McKinsey study tells us there was a 350% increase in “money in motion” last year.

The long-awaited baby boom retirement wave is now officially underway. How you answer these clients’ questions as they prepare for it, namely on Social Security filing and rollovers, will determine where they get their advice and where they consolidate their money.

Don’t Be The Same
Studies show that investors consolidate assets as they get closer to retirement, primarily for administrative reasons. And as someone who hangs out with this cohort, I know they are unsure of whom to turn to or where. All the advice and products look the same and are delivered in a language most don’t understand.

But they are quite clear they cannot make any mistakes. This is it—no more paychecks. So you would be wise to think of how you answer their initial questions on rollovers and Social Security. This is an audition, since they are making the most important financial decisions that will impact the rest of their lives. The key for you as an advisor is to demonstrate real and lasting value.

The Dollar Benefit Of Smart Social Security Filing
The first audition question we hear from the 90,000 advisors we work with is about Social Security. When and how should one file? Because the government provides an 8% increase per year in benefits to people once they reach full retirement age, which currently lies between 66 and 67 years old, depending on one's date of birth. Those who have the means are almost always better off waiting to start taking Social Security benefits.

Our advisors report that once they show the dollar benefit of waiting and how to file in different scenarios, their clients feel relief and some certainty about what to do. And then they ask what to do next.

Why Should They Give It All To You?
The next audition question is typically, “What should I do with my rollover?” But if there were a thought bubble over their heads, they are really asking, “Why should I give my rollover to you rather than all the other people I’m talking to?”

Those advisors who can quantify the financial benefits of a smart Social Security filing strategy—and who can do the same by combining taxable assets with rollovers—tend to win the asset consolidation game. The combination of a rollover with taxable assets can improve asset location and financial outcomes by as much as 33%, according to an Ernst & Young study.

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