CHICAGO, Nov. 11, 2014 /PRNewswire/ -- While most middle-income Baby Boomers have a hairdresser (73%), hired a mechanic (66%), or retained a handyman (52%), only about four in 10 (41%) use the services of a financial professional, according to a new study commissioned by the Bankers Life Center for a Secure Retirement ® (CSR).
The study - The Middle-Income Boomer Retirement Gap: Savings, Education and Advice – surveyed 1,000 Americans aged 50 to 68 with an annual household income between $25,000 and $100,000.
Of middle-income Boomers not working with a financial professional, four in 10 (39%) do not think they need financial advice because they prefer to make their own financial decisions. Other reasons vary—from feeling they don't have enough savings (20%) to believing financial advice is too expensive (11%).
Middle-income Boomers are an underserved market
Many middle-income Americans could be without adequate plans for retirement due to the tendency of the financial services industry to cater to wealthy Americans. Of Boomers who don't have a financial professional:
- 85% have not been contacted by one asking for their business in the past year
- 63% have never been contacted
Of Boomers who have a financial professional, one quarter (25%) sought out the relationship themselves, while for less than one in 10 (6%) the relationship was initiated by the advisor.
Boomers doubt financial security in retirement
Two-thirds (62%) of middle-income Boomers express some doubts that they will have enough money to live comfortably throughout retirement.
About half (48%) who work with a financial professional are confident they'll have enough money to live comfortably in retirement regardless of asset level, while less than a third (30%) without a professional feel that way.
Professional financial advice yields higher assets
Those who do turn to a financial professional generally have more saved for retirement. More than one-quarter (26%) of middle-income Boomers who have a financial professional have investable assets of more than $500,000, compared to less than one in 10 (5%) of those without a professional.
However, not all of those working with a financial professional start with a high level of assets. In fact, nearly half (43%) of middle-income Boomers who have worked with a professional less than two years reported less than $100,000 in investible assets. That number drops to less than one quarter (24%) for those who have worked with a professional for 10 or more years.
"Options are available for nearly any income and asset level, age and risk tolerance," said Scott Goldberg, president of Bankers Life. "Boomers need to take the initiative, reach out to one or more professionals and develop a financial plan for their future, because as we can see, the results tend to pay off."
The Middle-Income Boomer Retirement Gap: Savings, Education and Advice is part of a series of studies commissioned by the Bankers Life Center for a Secure Retirement. It was conducted in July 2014 by the independent research firm The Blackstone Group. The full report can be viewed at CenterForASecureRetirement.com.
The internet-based survey consisted of a nationwide sample of 1,000 Americans. All respondents were aged 50 to 68 and have an annual household income between $25,000 and $100,000.
Quotas were established based on the U.S. Census Current Population Survey data for age, gender and income to obtain a nationally representative sample. The margin of error is +/- 3.1 percentage points at the 95% confidence level.
About the Center for a Secure Retirement
The Bankers Life Center for a Secure Retirement is the Company's research and consumer education program. Its studies and consumer awareness campaigns provide insight and practical advice to help everyday Americans achieve financial security in retirement.
Bankers Life products focus on the insurance needs of the middle-income retirement market through nationwide subsidiaries of CNO Financial Group, Inc. (NYSE: CNO). These companies offer a broad portfolio of life and health insurance designed especially for those near or in retirement.
SOURCE The Bankers Life Center for a Secure Retirement