A landmark study was recently completed by Merrill Lynch in conjunction with Age Wave. Here is the PDF for your review: https://mlaem.fs.ml.com/content/dam/ML/Articles/pdf/ML_Finance-Study-Report_2017.pdf

We’d like to share a few of the findings with you:

Americans are rightly concerned about funding a comfortable retirement, yet most aren’t aware of what it will cost. Compared to life’s other biggest expenses—buying a home, raising a child, paying for college—retirement carries the highest average price tag. The average cost of retirement is over $700,000 or about 2.5 times that of the average house (FIG 7). It’s truly the purchase of a lifetime.

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Against a backdrop of economic uncertainty, financial hurdles, and growing concern about income inequality, younger generations feel that a financially secure retirement is falling out of reach (FIG 12). More than half of Millennials are pessimistic in this regard; however, they also have the longest lead time for learning what to do and taking action.

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For the overwhelming majority of people, the financial objective is not wealth per se, but peace of mind…Financial peace of mind, however, can mean different things to different people (FIG 13). For a 57% majority, it means being able to live comfortably within one’s means. For many, financial peace of mind also includes a strong element of freedom to live as one chooses, confidence in being able to handle an unexpected expense, or freedom from the burden of debt.

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Meantime, 60% of middle-aged and older Americans told us that one of their greatest worries is becoming a burden on their families. When asked what it means to be a burden, they said they’re worried not only about needing physical care, but also about interfering with the lives, finances, and emotional well-being of family members (FIG 25).

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The study is packed with other information and research you can use when advising your clients, including hypothetical “course corrections” related to home ownership in retirement, health care and Social Security optimization.

If you have any questions about how the newest annuities or life insurance strategies might help your clients overcome some of their retirement challenges, please call us at 800.440.1088.

 

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