financial advice

Pre-retirees offer advice opportunity

Financial advisers retirement

An opportunity exists for financial advisers to assist individuals over the age of 45 who are employed full-time with their retirement preparations.

Industry research conducted in the back half of 2022 has shown an opportunity exists for financial advisers to add value and peace of mind for individuals over the age of 45 who are currently in full-time employment with regard to their retirement years.

The Fidelity “New Life, Old Life” report revealed this cohort has the lowest life satisfaction driven by a sense of trepidation about what lies ahead for them in retirement.

Further, the study showed 50 per cent of individuals in this situation found the idea of transitioning to retirement appealing, but only 40 per cent of this group was actually putting this type of strategy in place.

“Only 40 per cent were getting advice [and so] 60 per cent of that cohort were not actually receiving any advice at all. We know there is a lot of complexity [with this strategy] so there is a lot of scope for financial advisers to get involved,” Fidelity International head of client solutions and retirement Richard Dinham observed during the release of the report in Sydney yesterday.

In addition, Dinham pointed out financial advisers also have the opportunity to meaningfully assist this cohort given the disconnect uncovered by the research between retirement expectation and what happens in reality.

To this end, 31 per cent of respondents indicated they had put retirement plans in place and were able to do so according to their plans, while 26 per cent of participants admitted retirement happened earlier than planned.

“Many [of the individuals surveyed] were thinking about retirement, but actually retirement was forced on many of them before perhaps they were ready,” Dinham said.

“We found 30 per cent or more had to take early retirement either through redundancy or ill health [pertaining to] themselves or a partner and so not being ready for that was quite a concern.

“So there is some scope for advisers to help with pre-planning [and to formulate] contingency plans for those sorts of eventualities.”

The study also revealed the importance of control as a major contributing factor for individuals to enjoy a higher level of well-being in retirement.

The report’s findings were based on the analysis of responses from 1207 Australians over the age of 45, who were either still working full-time, in semi-retirement or in the early stages of retirement, to an online survey conducted in August 2022 by research house Mymavins.

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