“The current
low-interest-rate, high-volatility environment makes it difficult for investors
to achieve their retirement goals,” said John T. Hailer, president and chief
executive officer of NGAM – The Americas and Asia, whose firm released a survey
today. “It’s encouraging that so many advisers believe they have the tools and
strategies to help clients navigate these challenges, but most advisers know
there’s still a long way to go, in terms of building more durable portfolios.”
Client
Concerns
The majority of
advisers (81%) say clients continue to be concerned about the long-term
durability of their assets, including meeting their retirement income goals,
outliving their assets (81%) and continuing declines in value of the real
estate they own (59%).
“Americans are no
longer in denial about real estate values, and they recognize how this impacts
their financial well-being, particularly in retirement,” said Hailer. “When
real estate values decline, as they have during the past several years, this
has a dramatic impact on financing retirement, and Americans realize that.”
Market
Volatility Raises the Stakes for Advisers
Four in five advisers
(81%) also reported that it will be difficult to effectively manage volatility
risk for those in retirement, with four in 10 (41%) saying it was
“extremely difficult.”
But advisers are
confident over the long term. “Advisers recognize they have the tools to build
portfolios that can weather market volatility,” said Hailer. “The challenge lies in educating
clients about the need to make smarter use of traditional asset classes and
embrace alternative investments, commodities, hedged equities and other
investments that can reduce risk in a portfolio.
“The survey
findings underscore the importance of advisers and other financial
professionals providing their clients with the information and tools they need
to make sound decisions about their personal savings objectives, risk
tolerances and retirement goals.”
Advisers
Oppose Scaling Back 401(k) Incentives
In the area of public
policy, 81% of advisers oppose proposals in Washington to scale back retirement
savings incentives for 401(k) plans.
The survey, which
was conducted in March, is based on online responses from 163 advisers at 150
advisory firms that collectively manage about $670 billion in assets.