Mary Beth Franklin

Retirement 2.0blog

Mary Beth Franklin on what your clients really want when they talk about retirement.

Helping advisers connect the dots about retirement planning

The demise of a noted research organization makes the job a bit harder

Dec 30, 2013 @ 11:14 am

By Mary Beth Franklin

I spent the final week of 2013 cleaning my office, discarding several trash bags full of old notes and research papers to give me a fresh start in the new year.

Along the way, I unearthed some gems buried in the detritus, including the 15th anniversary edition of the MetLife Mature Market Institute. The book highlighted the market trends and planning tips that the research organization had detailed in its many valuable reports over the years.

Who knew that when the MMI issued its greatest-hits tome in December 2012, the organization would close its doors a few months later. As a result, the financial planning community lost an insightful voice that over the past decade and a half identified matters of importance to an aging population, including the impact of longer lifespans on individuals and society as a whole.

Back when MMI was founded in 1997, most of us still used floppy discs to back up our data, only 20% of Americans used the Internet and researchers in the pre-Google world were on their own. By 2012, most of us were storing data in the cloud, Facebook hit 1 billion monthly users and the Encyclopedia Britannica discontinued its print edition after 244 years.

During those same 15 years of colossal changes, MMI issued groundbreaking research that refined the way consumers and financial advisers think about aging and how to harness the financial resources needed to create sustainable income for a retirement that could last 30 years or more.

In 1999, MMI issued its first Juggling Act Study, in which it estimated the potential wealth lost over a lifetime by working caregivers due to their caregiving responsibilities. It conducted a long-term-care awareness campaign in conjunction with the federal government in 2000, launched its first annual survey of nursing home and home care costs in 2002, and created the first MetLife Retirement Income IQ test in 2003, revealing that pre-retirees scored very poorly in knowledge of critical financial information for retirement. Beginning in 2007, MMI issued several snapshots as the earliest boomers headed into retirement.

Over the years, MMI issued reports and surveys about multigenerational views on family financial obligations, documented how aging homeowners used reverse mortgages and detailed how grandparents invested in their grandchildren by sharing their time, money and values.

“The demise of MetLife's Mature Market Institute is an unfortunate outcome,” Francois Gadenne, head of the Retirement Income Industry Association, wrote this week to RIIA members, which include financial institutions and individuals advisers.

Mr. Gadenne noted that RIIA was founded by 29 institutional members in 2006 to provide a view across the business silos in order to shape the future of the retirement industry and better serve the millions of Americans facing retirement income security challenges. MMI provided both thought leadership and financial support to the RIIA mission.

“The View Across the Silos is a bit like an Impressionist painting,” Mr. Gadenne said. “It brings the related dots together in the retirement body of knowledge so that the members can do more than connect the dots and actually see the picture.”

A key feature of the body of knowledge is its analysis of retirement allocations, Mr. Gadenne said. “Retirement allocations are to retirement management what asset allocations are to investment management, he said. Retirement allocations include "upside," "floor," "longevity" and "reserves" versus investment allocations that include stocks, bonds and cash.

Organizations such as the MMI and RIIA have been crucial to the evolving body of knowledge about retirement income planning and to the financial advisers who focus on helping their clients achieve retirement security. It's unfortunate that one of the leading voices in this important field has been silenced.

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