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trendspotting | PLANADVISER July/August 2017

Volatility, Retirement Top of Mind

Americans equally concerned about both

By Lee Barney editors@assetinternational.com | July/August 2017

Americans worry almost as much about short-term market volatility as they do about achieving their long-term retirement goals, Franklin Templeton Investments found in its 2017 Retirement Income Strategies and Expectations Survey. Forty-seven percent are concerned about short-term volatility and 53% about their retirement goals.

Volatility concerns men more than women (51% vs. 44%) while for women, long-term retirement goals are top of mind (56% vs. 49%).

Of the generations, Generation X is the least concerned about volatility—39% say they pay attention to it. Franklin Templeton says it is surprising that 47% of Millennials, who have the longest time horizon for investing, are worried about volatility and that 53% are concerned they will fail to achieve their retirement goals.

“The 24-hour news cycle contributes to a preoccupation with the short term,” says Michael Doshier, vice president of retirement marketing at the firm.

Sixty-two percent of respondents overall said they consider other household members when thinking about retirement, and this jumps to 84% if the person is married or living with a partner. Among those with a child under age 18, 16% expect that saving for his education will delay their retirement. Seventeen percent of working Americans with such a child are looking for college-savings-related tools.

Thirty-two percent of Baby Boomers and 31% of the Silent Generation said their 401(k) retirement plan savings is their primary source of income in retirement.

Eighty-one percent of those who have worked with an adviser said they are confident in their ability to invest for retirement, compared with 53% of those without an adviser. Among the former group, 95% said the adviser is integral to developing a plan to generate retirement income. Only 40% of those who invest in a 401(k) plan know how much it will generate in income during their retirement. That is a rather remarkable finding, as 60% of men and 47% of women said they have a strategy to generate income for a retirement that could last 30 to 40 years.

Retirement Outlook

47%
Concerned
about short-term
volatility
53%
Worried about
not achieving
retirement
goals
62%
Consider
household
members when
thinking about
retirement
40%
Know how
much their
401(k) plan
will generate in
income
53%
Would be willing
to retire later if
necessary
Source: Franklin Templeton Investments