Retirement Planning: A Changing Dynamic -- Investors Turn to Advisors for Help

Investors Better Prepared for Retirement, Still Lacking Financial Knowledge

New Report Shows Investors Relying on Advisors and Their Recommendations

WASHINGTON, D.C. – The Insured Retirement Institute (IRI) today released a new report showing that investors – those with at least $25,000 in investable assets – are better prepared for retirement compared to the broader population, but are still lacking knowledge regarding specific financial products. The majority of investors in turn are working with financial advisors and valuing their advice, with “advisor recommendation” cited as the top reason for selecting an investment. 

“IRI research has consistently shown that planning for retirement with the help of a financial advisor leads to better outcomes and more confidence,” IRI President and CEO Cathy Weatherford said. “With more than six in 10 investors working with a financial professional, it’s not surprising to see so many investors showing high levels of confidence regarding their retirement outlook. In fact, 59 percent of investors are very or extremely confident in having enough savings to live comfortably in retirement. Only a third of all Baby Boomers have that same level of confidence.”

Other key findings from the report:
  • Investors have considerable retirement savings, with 72 percent having at least $250,000 saved and 45 percent having at least $500,000 saved.
  • 62 percent of investors work with a financial advisor.
  • Retirement planning is the most discussed topic when investors consult a financial planner.
  • Nine in 10 investors say tax deferral is an important trait of an investment.
  • Investors are most knowledgeable about stocks and mutual funds, but only 46 percent of investors indicated that they are highly knowledgeable about these investments. 
  • Nearly four in 10 investors own annuities.
  • One in 10 investors do not know when they will retire, and 18 percent plan to work until age 70 or later. 
  • About two-thirds of investors rebalance their portfolios at least once per year. 
The IRI findings are based on a survey of 800 investors, aged 23 and older, with at least $25,000 in investable assets. Responses were collected in February 2014.

Click here to access the complete report.