My firm, Hartford Funds, recently conducted a survey with over 100 financial advisors that unearthed several missed opportunities. The data brought up three particular pain points that can be turned into advantages for financial advisors, if used wisely.
Michael Lynch Thu Aug 06 08:45:00 EDT 2015
There are generally two stages to the financial planning process: accumulation and distribution. As more and more Boomers move into retirement, focusing on the distribution phase is becoming increasingly important. One step in this process that is too often overlooked is ensuring that a beneficiary or beneficiaries are named—and more importantly, that the right beneficiaries are named.
Think about this: it has been said that the average beneficiary who was left a lump sum amount generally spends through that money within 18 months.1 Make sure your clients hear that statistic and really think about it—it might take them 30 years of hard work to accumulate a comfortable retirement, and it could be gone in just 18 months. That scenario might be hard to believe, but how often have you heard a story about someone who hits the lottery, and two years later has spent all of their winnings? How does that happen? Well, if they chose to take it all at once, they have to pay taxes on that money, so 30-40% is gone right away. Then they put it towards credit card debt, student loans, ‘honey-do list’ projects around the house, a dream vacation . . . You get the idea. The money disappears quickly.