Advisers Improve Retirement Peace of Mind

As part of its retirement study, Merrill Lynch Wealth Management developed an index to measure the current level of national retirement peace of mind.

Based on averages of responses to five questions, the national “Retirement Peace of Mind Index” at the time of the survey was 5.3 on a scale of 1-10. The index was calculated from responses to the following survey questions:  

  1. I feel content and comfortable about how I will spend my retirement years;
  2. I have many worries about what might happen during my retirement; 
  3. Thinking about my retirement gives me feelings of security and stability; 
  4. I feel anxious and uneasy about how I will support myself and my family during retirement; and 
  5. I feel well prepared for whatever may happen during my retirement. 

The survey from Merrill Lynch Wealth Management in collaboration with Age Wave found retirement peace of mind varies by gender, wealth, and use of a financial adviser. The index was 6.3 for those who work with a financial adviser versus 4.7 for those who do not.  

“People definitely benefit from professional assistance when it comes to saving for retirement. We found that those who use professional assistance, such as advisers, were 1.5 times more likely to get better results in planning and saving for retirement versus those that tried to do it on their own,” said Ken Dychtwald, Ph.D., founding president and CEO of Age Wave, during a press call.

The key elements identified by survey respondents for creating retirement peace of mind include: 

  • Financial security: confidence in safety of investments and having sufficient resources for retirement – 60%; 
  • Health optimization: confidence in having resources and reliable care to maintain health in retirement – 14%; 
  • Family well-being, feeling assured that family members will be financially secure and can rely upon each other when needed – 14%; and  
  • Personal purpose: having meaningful retirement goals, faith/spirituality, social connections, and personal legacy – 12%. 

Beyond core financial advice, sorting through health care and long-term care options is the top issue retirees and pre-retirees are seeking advice about, cited by 75% of respondents. Seventy-one percent are seeking advice about making sense of Social Security and employer pensions, and 58% seek help with inheritance and legacy matters.  

The Merrill Lynch survey was completed in January 2013, in partnership with Age Wave, and included more than 6,000 respondents age 45 and older. Data is based on more than 3,000 responses from the general population. In addition, select study findings are based on an oversampling of an additional 3,005 affluent respondents with $250,000 to $3 million in investable assets (including liquid cash and investments, but excluding real estate).

The study report is here.