A fiendish array of forces is conspiring against boomers’ retirement planning efforts.
Yesterday’s time-honoured retirement strategies are now being radically reshaped by high levels of debt, new OAS rules, low interest rates, volatile markets, taxes and fears of a housing bubble.
For those nearing, or in retirement, it’s becoming exceedingly challenging to find a planning panacea that will cure all ills. The role of a financial advisor, for that reason, has assumed greater importance than ever.
Now may be an opportune time to consider new investment approaches, greater use of alternative investments, and de-risking strategies — sew that up with smart tax planning.
A tax-efficient approach to both investing and withdrawals can ensure increased longevity of a retirement portfolio and a sustainable withdrawal rate.
Finally, the most underrated part of retirement planning: life insurance. Given its tax efficiency vis-à-vis, say, a bond portfolio, it’s an asset class worth considering for clients looking for a shelter in a different vehicle.
There are tremendous opportunities for advisors to educate clients about new challenges and opportunities for retirement planning. It can start with shifting their focuses away from absolute value of the portfolio to stability and predictability of income.
And while changing the conversation won’t be easy, here are some stories that can help.