Retirees with Advisers Have More Comprehensive Financial Plans

Those who rolled money over with the help of an adviser were more likely to have a comprehensive retirement plan.

A study by the Center for Retirement Income at The American College of Financial Services finds that the majority (62%) of recent retirees with substantial assets in a defined contribution plan at retirement chose to move their assets out of the plan.

More than eight in ten did so with the help of an adviser.

The survey found that those who rolled money over with the help of an adviser were more likely to have a comprehensive retirement plan (89%, compared with 71% who rolled over without the help of an adviser).  Furthermore, their financial plans were comprehensive, reflecting retirement income planning strategies. 

Recent retirees with a financial plan report their plan contains an estimate of the amount of income they will receive each year in retirement (95%), a plan for where their income will come from each year (93%), and an estimate of how long their income will need to last (93%). Those who work with advisers are somewhat more likely than those who do not to say that their plan includes targets for how their assets will change over each year (73% vs. 61%). Respondents reported that advisers were less likely to include how to pay for long-term care (59%) and legacy planning (55%) in their comprehensive plan.    

NEXT: Why roll over retirement assets?

Eight in ten respondents (80%) agreed that advisers are helpful because they can review the retiree's financial planning and point out things they have missed.

Only 38% of respondents left money in their retirement plans, with only about half (56%) reporting that they have an adviser.

According to the survey, the main reason retirees rolled over their assets was the probability of improving performance (70%), followed by consolidating assets (68%). For those who kept money in the plan, two-thirds (65%) cited liking the investment options. Nearly half of this group took a more passive approach, reporting that it was easier to leave things the way they are.

One area of concern reported by retirees related to the investment of assets. Just one-third (34%) feel extremely or very knowledgeable about investing and investments, and only 43% of respondents feel extremely or very confident about making savings and investment decisions on their own without an adviser.

The survey was conducted between October 8 and October 26, of 1,002 respondents at least 60 years old, retired from full-time employment within the past three years, and with at least $75,000 invested in their former employer's 401(k) or 403(b) plan at the time of their retirement.