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Helping baby boomers with changing retirement needs

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As the Baby Boomer generation enters retirement, financial professionals are learning to adapt to changing client expectations. While saving and growing funds has been their focus for the last few decades, they’re now looking for ways to convert savings into a retirement income.

This transition may require some financial professionals to add decumulation strategies to what they now offer. Get started by understanding the nature of baby boomers’ concerns about retirement income and then look for opportunities to adopt new financial products and strategies that ensure your practice continues to meet their needs.

Guaranteed income is a major concern
Baby boomers face greater financial challenges than previous generations. Many are carrying mortgages into retirement, while others are still supporting their adult children and even elderly parents. On top of these challenges, lifespans are increasing. On average, 65-year-olds today are expected to live to age 85 and about one out of every four will live past age 90.1

With longer lifespans come increased lifetime costs for housing, day-to-day expenses and, especially, health care. Looking ahead, clients need help developing a retirement income plan that will support their desired lifestyle — and they want to eliminate as much uncertainty as possible from that plan. New research from Kiplinger and Athene shows that Americans are looking for more guaranteed income in retirement. Most respondents (57%) say that having more guaranteed income in retirement would ease concerns about running out of money. More than a third (34%) say having more would ease concerns over market volatility.2

How fixed indexed annuities help address client concerns
Given strong client interest in guaranteed income, financial professionals should consider how specific products and financial strategies can help meet that need. Fixed indexed annuities (FIAs) can complement other tools in a retirement income strategy, including 401(k)s, IRAs and Social Security benefits.

FIAs provide guaranteed income in retirement through a unique design that offers a combination of growth potential and protection from market risk. The contract earns interest that’s tied in part to the growth in one or more stock market indices. Interest income rises as an index increases in value. But when the index is down, the contract’s Accumulated Value is protected from market loss.

This combination of growth plus protection can instill confidence in clients concerned about having enough savings to support their retirement lifestyle. Additional sources of guaranteed income in a retirement plan can also provide greater flexibility for investing in other assets, which can help further address longevity risk, create a legacy or provide a cushion against higher-than-expected medical bills or other surprise expenses.

Strengthening your practice
Helping Baby Boomers with their changing retirements needs is good for clients — and it’s good for your business, too. Financial professionals who can assist boomers with their new retirement landscape may enjoy greater levels of customer satisfaction and loyalty. In turn, they’ll gain referrals from those happy clients.

While you may keep more client assets under management, your clients gain a better overall experience and often prefer having one person oversee a comprehensive retirement income plan than relying on multiple sources of potentially conflicting advice.

This information is brought to you by Athene — where innovative annuity solutions are powered by unconventional thinking.