Financial product manufacturers and distributors have found that one of the best ways to win the hearts and minds of financial advisers is to provide Social Security support tools ranging from educational brochures to sophisticated software.
That was the finding of a report examining the types of programs that asset managers, insurance companies and broker-dealers typically provide to financial advisers. Programs focused on Social Security, as well as adapting portfolios to a low-interest rate environment, were the most widely used during the past year, according to the report, “Value Add Support to Financial Advisors — Insights and Opportunities 2014,” released Monday by Practical Perspectives, an independent consulting and research firm.
Based on input from 600 financial advisers gathered through an online survey in May, the report analyzes how these programs influence advisers' perceptions and behaviors. Those surveyed include full-service brokers, independent brokers, financial planners, registered investment advisers and bank representatives.
“Firms are spending heavily on these programs to generate awareness and goodwill among advisers as they look to differentiate their products and services,” Howard Schneider, president of Practical Perspectives, said in a statement accompanying the report. “In the past year, advisers indicated these programs have a growing influence on key factors such as their willingness to consider a particular providers and their loyalty to a provider.”
Mr. Schneider told me that the most popular provider of Social Security support material is BlackRock Inc. He also said he is working on a separate report that analyzes the various Social Security tools and support material being offered by different financial services firms. That report will be available next month.
In the meantime, Nationwide Financial announced that it is expanding its presence in the crucial Social Security advice arena by offering financial advisers free access to a robust planning tool to help them counsel clients on benefits and claiming strategies.
“America's workers need to have a clear understanding of their options to identify a filing strategy for Social Security and connect the filing strategy to their overall retirement plan,” said David Giertz, president of distribution and sales for Nationwide Financial.
“Only a third of clients are getting the advice they need on Social Security, but more than half say they expect it, and almost all clients say they'll leave their adviser if they don't get Social Security advice they're looking for,” Mr. Giertz said.
The Nationwide Financial Retirement Institute launched the free Social Security 360 program last week.
The tool, powered by software from Social Security Timing, compares all the election strategies available to married couples, single people, divorced spouses, widows, government employees and even those who have already claimed Social Security benefits. Advisers can generate personalized reports including claiming instructions, cash flow and projected income gap.
Joe Elsasser, creator of Social Security Timing, said the partnership with Nationwide is the ideal pairing to advance Social Security Timing's mission: to help financial advisers enhance clients' lives through better Social Security decisions.
“Nationwide's strength and reach, and Social Security Timing's patented analysis of Social Security claiming options are a powerful combination,” Mr. Elsasser said. “Together, we're educating America's workers on one of their most important decisions in retirement — when to claim Social Security — and how that decision fits into a holistic retirement plan.”
Purchased independently through Social Security Timing, the software costs $49.99 per month or $500 per year.
(Questions about Social Security? Find the answers in my new ebook available at www.investmentnews.com/MBFebook for $19.95.)