And the times, they are a-changing
I knew it would happen sooner or later.
I was at a social function and someone came up to me and asked why I had not been writing very much. I wish I had a good excuse, but I don't.
It is simply a fact that we are in a time of change and transition. The old perspectives can no longer just be assumed. Clients and planners alike must question everything and reassess their portfolios, goals, and risks. It is a time of uncertainty but also a time of great opportunity. As of the beginning of this year I have been in practice for over twenty years, and never before have I experienced such a strong demand for my time.
Last year, in Managing the Road to Retirement from the TransAmerica Center for Retirement Studies, survey respondents were asked how much money they believe they will need to have saved by retirement to feel secure. Here are the survey results:
Ages 20 – 29
$750,000
Ages 30 – 39
$1,000,000
Ages 40 – 49
$800,000
Ages 50 – 59
$500,000
Ages 60 +
$500,000
With the exception of the youngest group, it makes sense that younger respondents felt like they would need to have more money saved to feel secure in retirement. Over time, inflation demands retirees have more available savings to pay for the same retirement.
The real eye-opener for me was the follow up question where the same respondents were asked to admit if they had just guessed at that amount. The percentages who admitted to guessing were:
Ages 20 – 29
63%
Ages 30 – 39
50%
Ages 40 – 49
49%
Ages 50 – 59
45%
Ages 60 +
37%
Again, those closest to retirement seemed more certain of their responses but still… more than 1/3 of pre-retirees have no idea how much money they will need for a successful retirement. Add to that an uncertain stock market, talk of potential tax increases, and fears of inflation. Is it any wonder many people are seeking professional advice?