Two investment experts who worked together on a retirement and investment study for the year conclude that longevity planning can be more beneficial for workers aged upwards of 44. The study, conducted by financial firm The Hartford, also says that more Americans look at government pensions (including Social Security) as their prime income source for retirement. The figure is now at almost 39% of all participants, compared to about 26% four years ago.
Today, it is safe to say that many investors and financial experts find Social Security payouts inadequate when it comes to being a main source of funding for retirement. This year, more than 85% of all participants said that they were no longer confident about Social Security benefits and its boost towards their overall nest eggs, compared to about 81% four years ago.
MIT AgeLab founder Joe Coughlin says that the Baby Boom generation needs to influence retirement security for the better by embracing a consumer-driven retirement. He also says that the retirement finance industry needs to constantly update and appraise its products and services to resolve the concern of inadequate retirement funding as problems arise and get more complex. Today, around 75% of all respondents say that they need to take the initiative and work out their own financial solutions for the problems surrounding retirement, compared to only 71% in the 2006 survey.
Today, there are not that many products and services that move the focus of planning around longevity, and not the conventional concept of retirement. John Diehl, The Hartford senior vice president, says that there needs to be more research and development from financial service providers about the longevity concept, while Coughlin states that the 529 plan is one such tool that is already in place. This plan is typically used to save money for education, but may also be used to pay for the educational expenses of a senior or retiree who wants to learn more and work in a different industry. Alternatively, it can be used for updating the financial strategies surrounding your retirement planning or longevity planning.