Investment Advisor's Retirement Plan Advisor, August 2006
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August 2006 Boomers Need HelpPublic remains blissfully unaware of potential retirement problems By SAVITA IYER It seems that every newspaper, magazine and television news program
of late has covered the subject of baby boomers and retirement. Yet,
despite the deluge of news and information available to the public, the
general feeling in the retirement planning industry is that most boomers
are still not equipped to deal with the realities of living a retired
life. And not only are those approaching retirement not ready, but the
generation that succeeds them is also blissfully unaware of the
importance of starting retirement planning at an early age. This is a huge challenge for financial planners and advisors, more
often than not one that is extremely difficult to get around. Yet
according to a recent McKinsey study, Cracking the Consumer
Retirement Code, striking the right balance between what retirees
and pre-retirees want, and what they can expect, is a
burden that financial planners are going to have to deal with more than
ever before. A better understanding of what retirement could be like is
not likely to come from clients themselves, the study says. Those
planners that manage to successfully step up the kind of outreach they
provide to their clients will go a long way toward arming successive
generations of individuals for a better retirement, while at the same
time allowing advisors to secure for themselves a place as trusted and
credible parties in the retirement planning industry. Big Changes Since
1960 The passage and signing into law of the Pension Protection Act of
2006, which is aimed at pushing companies to shore up their pension
plans and ensure workers get their promised retirement benefits—a
move that many have hailed as the most comprehensive reform of the
American pension system in decades—has once again underscored the
continued decline in traditional pensions and the rise in
defined-contribution plans as the way of the future. The new law comes just weeks after a joint conference held by the
Employee Benefit Research Institute (EBRI) and the American Association
of Retired Persons (AARP), which concluded that the ultimate demise of
private-sector defined benefit pensions is now a foregone
conclusion. © 2006 Wicks Business Information, LLC |
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