How Retirement Planning Is Changing Post-Pandemic

Retirement planning is experiencing a generational shift from DIY investing to following a structured, systematic and guided approach fueled by millennial technology. The market downturn has developed unexpectedly beyond forecasts, affecting the wealth of millions of retirees over the past few years.

Europe’s energy crisis, market volatility and the Fed’s hawkish stance to control raging inflation could wipe $3.4 trillion from 401(k)s and IRAs in the first half of 2022, Bloomberg REPORTS.

The massive losses have sparked a renewed interest and sense of urgency in the minds of Americans to plan for their retirement. American Reserve Finance released A new study, The Disconnect: Perception vs. Reality in Retirement Planning, from the Stanford Center on Longevity (SCL). The study surveyed 2,000 US retirees and pre-retirees between the ages of 50 and 74 and revealed that most are not financially prepared for retirement.

Most remarkably, only 41% of respondents consulted a financial advisor, but 60% of retirees and 64% of pre-retirees would find it very valuable to have the guidance of a financial professional in formulating a retirement plan.

this free quiz can match you up to three vetted financial advisors who serve your area, each obligated to work in your best interest.

At the same time, many are moving beyond the traditional 60/40 portfolio allocation, exploring new and tangible investment options. Additionally, workers are stressing the importance of creating a passive income stream and investing in an employer-sponsored retirement vehicle or IRA.

As aging workers are increasingly concerned, the retirement picture for America’s youth is not rosy, with most priced out of the wealth-producing housing market and struggling to save money with student loans and credit card debt.

The retirement crisis can be caused by a lack of discipline, poor financial literacy and emotional investment tendencies triggered by unfavorable markets. National Council of Financial Educators 2021 survey from 3,389 people revealed that 10.7% lost more than $10,000 due to mismanagement of money.

Seeing your life savings disappear overnight can be difficult, and trying to control the damage without the proper knowledge can delay your retirement goals by years. At the same time, talking about money is not easy for many.

The first impact of a suitable financial advisor in your life can be a simple but effective step to prevent further financial losses, followed by planning future growth plans while protecting your emotions.

Want to speak with a financial advisor but not sure where to start? this free quiz can help match you with three advisors serving your area.

Financial advisor following fiduciary standards is legally and ethically required to make the best decisions for the client. These trained professionals go through a rigorous course that focuses on establishing a safe space for clients to explain their situation. Detailed information helps advisors identify sources of money conflicts, outline wealth creation roadmaps, and plan for unexpected crisis events.

Although the emergence of AI-Powered robo-Advisors allows you to create an investment plan starting at $1, there are many life events like estate planning, starting a family, putting a down payment on a house and even getting a divorce that digital applications cannot handle. In addition, robo-advisors will not stop you from transferring money, unlike human intervention.

At the same time, partnering with an advisor should be seen as a long-term investment in itself because a good client-advisor relationship has the potential to last for decades. Depending on your goals, which can range from managing large amounts of wealth or taxes to navigating financial pitfalls and paying off debt, choosing the most suitable advisor with a specialization in alignment with your situation becomes an important part of your retirement vision.

Experienced financial advisors should know how to help younger clients start saving and help those in retirement. A latest Vanguard white paper estimated that a hypothetical $500k investment could grow to more than $3.4 million in 25 years under the supervision of an advisor, compared to only $1.69 million from a self-managed portfolio.

Assume 5% annual growth of a $500k portfolio vs 8% annual growth of an advisor managed portfolio over 25 years.

The hypothetical study discussed above assumes a 5% net return and 3% net annual value addition for professional financial advice for performance based on Vanguard Whitepaper “Putting Value on Your Values, Calculating Vanguard Advisor’s Alpha”. Please carefully review the methodology used in the Vanguard Whitepaper The value of professional investment advice is only an illustrative estimate and will vary depending on the individual circumstances and composition of each client’s portfolio. Carefully consider your investment objectives, risk factors, and conduct your own due diligence before selecting an investment advisor.

The research time involved in finding the best financial advisor for your retirement goals can be hectic. Many check with friends and family to see if their advisors work for them, while others search online.

A good start would be a database of free financial advisors such as I’m dying (National Association of Personal Financial Advisors) and Network Planning XYwhich can reduce your search time by sorting advisors by location, specialty, and services offered.

However, SmartAsset has developed one independent financial advisor suitable tool which can match you with up to three fiduciary advisors serving your area in just a few minutes.

SmartAsset can also help arrange an introductory meeting for you to interview your advisor match about the track record, fees, investment approach, specialization, services offered, minimum amount that can be invested, mode of communication, and the scope of acquiring financial knowledge.

  • Find a qualified financial advisor it doesn’t have to be hard. SmartAsset free tool match you with up to three financial advisors who serve your area, and you can interview your advisor match at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, start now.

  • If you’re just getting started with investing, working with a robo-advisor can help. Robo-Advisors offer portfolio management services like traditional financial advisors, but they typically have lower fees and account minimums. This is the tea top 10 robo-advisors.

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