Eighty-eight percent of financial advisors now say that their clients are “off-target” for a timely retirement, primarily because of market depreciation, as opposed to 46 percent at the beginning of 2008, according to Brinker Capital, a leading investment management firm, that released the year-end results of its Brinker Capital Retirement Indicator, a gauge of financial advisor sentiment regarding retirement-related issues.   In effect, it shows that the clients’ retirement security has been severely jeopardized by ongoing market deterioration.   In fact, of the respondents who said they were off-target, some 74 percent claimed it would take between one and five years to make up the retirement savings shortfall. As to the reasons for being so, 97 percent said "market depreciation," 51 percent noted "didn't start saving soon enough," and 47% percent said "general procrastination."   Brinker says that the question which provoked the most vigorous response was: "Are you seeing a disconnect between your clients' responses on their risk tolerance questionnaires and the level of risk they are willing to take today?" Some 75 percent of financial advisors weighed in with a resounding "yes." When asked if they think there should be a reassessment of the way clients' risk tolerance is measured, 76 percent also said "yes."   Of course, going a little bit further down the road, when asked to comment on whether the government should mandate employee and employer participation in 401(k)s, 74 percent of advisors said "no." Moreover, a decisive 92 percent of advisors said "government should stay out of the management of 401(k)s."   Clearly, these are rather strong responses. In addition, consider others such as:

  • 65 percent of advisors noted that their clients "have become more vocal/involved in the investment process," whereas 31 percent said their clients "have stayed neutral about their involvement in the investment process." Only four percent of advisors indicated their clients are now "less vocal."
  • 44 percent of advisors are seeing an increase in clients tapping into their retirement savings to provide liquidity for the near-term, versus 56 percent who have not experienced such liquidation.

  Also, when asked if they believe that the proposed full fee disclosure regulations (with respect to qualified plans) are needed, 67 percent of respondents answered in the affirmative.   For a copy of the full year-end survey, please contact, jdragovic@middlebergcommunications.com   The Brinker Capital Retirement Indicator was conducted online by Brinker Capital last November. Results are based on responses from 221 advisors affiliated with insurance companies, independent broker-dealers, as well as those in sole practice. Visit Brinker Capital's website at www.brinkercapital.com.

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