hile more than 7 in 10 affluent pre-retirees age 55 and older feel confident about their ability to generate a suitable income stream in retirement, less than one-third have determined the most sensible Medicare option or evaluated financial protections against major health event
expenses¡ªwhich could substantially impact their ability to make their retirement savings last throughout their lifetime. These and other important findings are included in Investor Retirement Income Trends™, a recently published Cogent Reports™ study by Market Strategies International.
According to the report, 64% of affluent pre-retirees have estimated their monthly expenses in retirement, and 68% have calculated the best time to begin taking Social Security payments. But just 29% have identified the best Medicare option for their personal situation, and only 32% have investigated options to protect their savings from catastrophic healthcare costs.
¡°The majority of pre-retirees have essentially done the easy part,¡± explains Julia Johnston-Ketterer, author and senior director at Cogent Reports. ¡°They¡¯ve used some online calculators and talked with their financial advisors about ways to generate a ¡°paycheck¡± in retirement from the assets they¡¯ve accumulated. But relatively few of these conversations address the topic of healthcare in retirement, which is essential in ensuring that these pre-retirees don¡¯t outlive their savings.¡±
Going beyond healthcare, the study asked pre-retirees about the extent to which they had completed a set of 16 tasks considered to be vital components of a comprehensive retirement plan, ranging from the typical financial aspects like estimating taxes, to more personal choices such as determining the best place to live in retirement. Less than half said they completed more than 2 of these 16 tasks.
¡°Clearly there is more that the financial industry can do to help pre-retirees with their retirement planning needs,¡± says Johnston-Ketterer. ¡°As more and more Baby Boomers approach retirement age, opportunity abounds for financial services providers who can successfully position themselves as a go-to resource¡ªeither for the investors themselves or for financial advisors who are challenged to provide retirement planning assistance with complex tasks outside of their traditional investment advisory role.¡±
