Wealth Management Blog

Posts published in November 2012

The Benefits of Working With an Advisor

By JJ Burns

November 18, 2012

People who work with a financial advisor are far more likely to understand the situation they will face after they retire, according to a recent survey by Franklin Templeton Investments.

Two out of three people who work with a financial advisor know the amount of retirement funds they will withdraw each year after they retire. That’s almost twice the proportion of those who’ve never worked with an advisor who have that knowledge, according to the Franklin Templeton Retirement Income Strategies and Expectations (RISE) survey, taken in September 2011.

Volatile world markets and changes in the way people build retirement assets make it more important than ever for pre-retirees to understand their retirement picture, says Michael Doshier, vice president of retirement marketing for Franklin Templeton.

“Sixty-seven percent of respondents were more concerned about investment volatility than they were prior to the recession that began in 2008,” Doshier said. “People’s worries varied by age, gender, and income level, but from a general standpoint, some of their specific worries related to health expenses, Social Security, and simply running out of money.

“Our survey also showed, however, that working with a financial advisor can make a clear difference in how Americans think about retirement planning. By sitting down with a financial advisor, identifying and prioritizing one’s retirement goals and concerns, and writing down a simple plan to address them, people can take meaningful steps toward confident action.”

The RISE survey was conducted online among 1,020 men and 1,026 women. Here are other findings:

  • 38% of respondents who never have worked with a financial advisor said Social Security will provide the most income during their retirement, compared with 19% of people who work with an advisor.
  • Just 4% of people who never have worked with a financial advisor said IRA funds will provide the most income during their retirement, compared with 13% of people who work with an advisor.
  • 35% of people who never have worked with an advisor said they do not think about how they will approach different sources of retirement income.
  • Running out of money in retirement is the top concern of 35% of people who never have worked with an advisor, while 24% of those who work with an advisor cited it as their top concern.
  • Of those respondents who never have worked with an advisor, 41% said they don’t think they have enough money to need one, and 30% said they prefer to handle their finances on their own.
  • 79% of Americans currently do not work with a financial advisor, but 47% of respondents said they would consider going to a financial advisor or switching their current advisor if the advisor prepared a written retirement income plan.