There’s More to Retirement Than Savings

Being emotionally prepared for the transition is as important as sound financial planning, TIAA says.

Getting emotionally ready for one’s retirement is just as important as saving enough, according to a survey of 1,500 retirees by TIAA.

Retirees experience stronger ties in their relationships with friends and family, the survey found. Ninety-three percent of retirees said that their relationships with friends remained steady or improved, while 96% said the same of their associations with family members.

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As for their dealings with their spouse or partner, 95% said it remained the same or improved. Eighty-five percent of retirees with a spouse or partner who said their transition into retirement was easy said that they and their partner share the same outlook. By comparison, 53% who had a difficult transition do not see eye-to-eye with their partner.

“Like any major life change, retirement can have a significant impact on relationships,” says Roger Ferguson, Jr., president and CEO of TIAA. “Our research shows that taking the time and care to plan for this transition—both emotionally and financially—helps to set up retirement success. For couples, going through the planning process hand-in-hand helps both partners more easily adapt to retirement.”

Retirees also report that they try to stay active. Among those who participate in 10 or more activities, 76% say they are satisfied with their retirement lifestyle, while only 52% of retirees who participate in one to four activities are happy. Retirees age 80 or older, however, say they are not nearly as engaged as they were when they were younger.

The No. 1 way people spend time in retirement is pursuing interests and hobbies on their own, a stark contrast to the team approach they experienced in the workplace, TIAA notes. This represents a big shift from working life, and is an important shift for retirees to prepare for psychologically, the firm says.

NEXT: Retirees’ sound financial outlook

A heartening finding from the survey is that 86% of the retirees said that they are satisfied with their finances. Fifty-four percent said that they have not had to make and lifestyle adjustments, although 20% have made such minor changes as buying fewer clothes or eating out less.

Sixty-five percent are either volunteering or working with charitable organizations. Seventeen percent are working for pay, and of this group, only 5% are doing so for purely financial reasons.

Thirty-three percent of retirees between the ages of 66 and 69 say they are putting a priority on charitable giving, and this rises to 43% of those 80 or older. Leaving an inheritance is significant to 28% of the younger group and 49% of the older group. Eighteen percent or the former want to ensure financial security for their dependents, increasing to 33% of the latter.

TIAA also looked at the activities of male and female retirees. Retired women are more likely to engage with others and give back to their communities by volunteering (58% of women versus 42% of men) or caring for family members (43% versus 26%). Men are more likely to pursue active personal hobbies, like sports (38% versus 18%) or work (28% versus 19%).

Male retirees are also more confident about their finances, with 77% saying that they found the transition into retirement easy, compared to 69% of women. Fifty-eight percent of male retirees are very satisfied with their financial health, compared to 46% of female retirees. Twenty-nine percent of retired women, on the other hand, are worried about running out of money, compared to 15% of their male counterparts.

Aging is a concern for both sexes. Fifty-three percent of retirees worry about becoming a burden to others, 46% agonize about a spouse or partner dying, 44% think about what their life will be like if their mental abilities deteriorate, and 43% worry about mobility issues. TIAA notes that this is why retirement plan participants should invest in health savings accounts and those approaching retirement or in retirement should consider long-term care insurance. The investment firm also says that retirement plan sponsors should include lifetime income options in their investment lineups.

GfK Custom Research North America conducted the survey among a total of 1,583 TIAA retirees between May 28 and August 27, 2015. TIAA’s full “Voices of Experience” report can be downloaded here. The survey is a follow-up to a similar survey TIAA conducted 34 years ago, in 1982.

Social Media Has Become Critical for Advisers’ Marketing Efforts

Today, advisers are spending equal amounts of time on social media and networking.

Eighty-five percent of advisers are using social media, up from 75% in 2014, according to the Putnam Investments 2016 Social Advisor Study, based on a survey of 1,018 financial advisers. In addition, 80% of advisers are winning new clients via social media, up from 49% in 2013, and 85% of advisers say that using social media expedites the time it takes to win new clients over.

Seventy-three percent of advisers are using LinkedIn, up from 64% in 2014; 54% are using Facebook, up from 36% two years ago; and 44% are using Twitter, up from 27% in 2014. Advisers say that social media has helped them attract an average of $4.9 million in new assets. Fifty-six percent said it helps them work more efficiently. Advisers also report that they are spending equal amounts of time personally networking and on social media, with each effort averaging 10 hours a week.

For advisers with $100 million or more in assets under management (AUM), 35% said that social media is an important part of their marketing efforts, and slightly more than the average among all advisers, 82%, have used social media to woo new clients. For this group, social media has helped them attract an average of $8.3 million in new assets.

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As Putnam Investments says in its report summarizing the findings of its survey, “Advisors Are Social,” “The question is no longer whether social media can function within the confines of closely regulated communications and transactions—but, rather, how social networking strategies work best in tandem with traditional methods to optimize adviser reach, influence clients and cultivate a successful practice. Notably, advisers who adopt multiple advanced features, including paying for premium access or content placement, are far exceeding the asset gains of their colleagues who are taking a more passive approach to social networking. As social media platforms continue to proliferate and evolve, a presence on social media is now ‘table stakes’ for advisers.”

William Connolly, co-head of global distribution for Putnam Investments, describes the importance of social media this way: “In our ongoing dialogue with financial professionals, it is eminently clear that social media’s role as a critical conduit for advisers in reaching the marketplace is going to continue to deepen and evolve for the foreseeable future.”

Brightwork Partners conducted the survey for Putnam in July. The full “Advisors Are Social” report, which includes links to tutorials on how to use LinkedIn, Twitter and social media and other forms of technology in general, can be downloaded here.

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