Rethinking Retirement

As the baby boomer client base enters retirement, financial planners need new ways to handle Social Security claiming strategies.

One of President Obama's proposed 2015 budget changes calls for a provision that would require Roth IRAs to follow the same RMD rules as other retirement accounts -- a 'major game-changer' for retirement planning, says one IRA expert.

A few years ago, a trio of analysts created a stir when they published two memos suggesting that the American economy had become a “plutonomy” – one that is highly and disproportionately controlled by the extremely wealthy. Keith Webber says that, when looking ahead to the millions of baby boomers who will be retiring in the next 15 years, it’s not hard to envision the idea of retirement turning into a “plutirement,” with two very different retirement realities facing your clients.

The Jones’s are alive and well, and keeping up with them just got more expensive.

When the concept of retirement was first mainstreamed in America in the 1930’s, it was largely viewed as having “one foot already in the grave.” For many baby boomers today, it might well mean the same thing.

A recent paper by the Center for Retirement Research at Boston College suggests that in terms of actually being able to maintain one’s lifestyle in retirement, compared to other factors, the focus on asset allocation is largely misplaced.

Author and consultant Keith Weber says financial advisors need to cater their messages and their services to different generations of clients who have divergent agendas but share many of the same retirement planning concerns.

Author and consultant Keith Weber doesn’t normally attend protests, but when the “Occupy Wall Street” movement showed up in Denver, he decided to go take a look. What he found was a group of diverse individuals who share a common set of values that are highly reminiscent of those expressed by the Socially Responsible Investing industry.

One of the hot topics in the field of behavioral finance is the use of heuristics -- simple rules of thumb or mental shortcuts often used to make decisions or draw inferences quickly and with minimal effort. While in everyday life these mental shortcuts help us to function quickly and efficiently, author and consultant Keith Weber says that when they’re applied to our personal finances they can often lead to poor investment decisions.

Last month the Insured Retirement Institute released yet another in the long line of reports indicating the majority of baby boomers are nowhere near ready for retirement. Since we can’t slow down the clock to give them more time to prepare their financial capital, consultant and author Keith Weber says maybe it’s time we start helping them prepare their human capital.

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