A recent study by Jackson National Life Insurance Company indicates that US consumers are increasingly concerned about the impact of inflation on their financial security in retirement.
The report, part of Jackson's Security in Retirement Series conducted with the Center for Retirement Research at Boston College, highlights a growing pessimism among both pre-retirees and retirees.
The study, which surveyed over 1,500 individuals aged between 55 and 85 and 400 financial professionals in 2023, found a divide between the two groups. While a quarter of consumers (26 percent) predict inflation rates north of 5 percent in the next few years, only eight percent of financial professionals held that view.
“[W]e’re seeing that, to varying degrees, consumers and financial professionals are either unsure or simply getting it wrong,” said Glen Franklin, assistant vice president of research, RIA and lead generation strategy for Jackson’s marketing and distribution business, said in a statement.
The latest inflation figures from the Bureau of Labor Statistics showed some relief from consumers, with core CPI rising in April by a modest 0.3 percent compared to the month prior, and just 3.4 percent from a year ago.
To help safeguard their clients against inflation, advisors used a host of strategies, with diversification as the top approach. Around two-fifths (42 percent) recommended increasing their exposure to annuities with guarantees, a substantial change from just 32 percent who did so from 2021 until the end of 2022.
Advised consumers who received anti-inflation advice reportedly lost just 2 percent of their purchasing power on average in the past 12 months to rising price pressures, compared to 4 percent of those who didn’t work with an advisor.
Retirees and pre-retirees in the survey were also split when it comes to their perceptions of inflation. While 41 percent of pre-retirees said price pressures weighed on their household finances, just 29 percent of retirees said the same.
“High inflation has real impacts on financial security in retirement,” said Alicia Munnell, director of the Center for Retirement Research at Boston College.
“While many households did offset the short-term pain by tapping assets and cutting back on saving, such actions will mean less consumption in the future,” Munnell said.
"Shares of alternative assets managers have lagged this year as investors grow wary of private-credit exposure."
The fintech platform is touting a new AI-free Planning Observations feature, which draws on IRS tax records to uncover opportunities for advisors.
The Omaha, Nebraska-based RIA's latest acquisition expands its Rocky Mountain footprint after two prior Colorado deals last year.
Operational drag between an advisor signing and accounts going live is emerging as a competitive liability for wealth management firms.
Bain says companies face a "winner's paradox" as AI transformation collides with complex integrations.
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.
