Advisers may be brushing up on their
Social Security know-how, but people approaching retirement seem to be taking a do-it-yourself approach.
In a recent study from Securian Financial Group Inc. of 804 people between 50 and 65, only 18.3% either were developing a plan for claiming
Social Security benefits or already had a strategy in place.
Meanwhile, the remaining 81.7% of the participants were, at best, only starting to look into
Social Security.
The most proactive pre-retirees — those who have developed a plan — typically have made changes to their
Social Security strategy either to change their retirement date, adjust the date when they'll start collecting benefits or tweak the amount they're planning to spend in retirement.
However, they're mostly making these judgment calls on their own.
Advisers ranked fifth on the list of sources these pre-retirees use for building their
Social Security strategies. The
Social Security website came first, followed by the local
Social Security office and retired friends and family in second and third, respectively. Even online tools and calculators were consulted more often than financial advisers.
Advisers will need to step up to the challenge and brush up on their
Social Security skills in order to build their clients' confidence in them, noted Michelle Hall, manager of market research at Securian.
“This might not be an area in which they've been that proactive in talking to clients,” she said.
There are signs that some of that's starting to change, however, especially as clients and advisers age. These days, retirement income planning is a hot topic and advisers want to build their
Social Security expertise to determine how it works in concert with income products that clients already own, Ms. Hall noted.
An informal poll of advisers by Securian last year revealed that “retirement income best practices” and “maximizing client
Social Security benefits” were some of the top subjects they wanted to learn more about.
“Advisers need to be well-informed,” she added. “They're getting questions from clients on how [income sources] fit together.”
