Our daily roundup of retirement news your clients may be thinking about.
Aging adults optimistic about what lies ahead
A majority of aging and younger adults expressed optimism about the quality of life they will have in retirement, according to a survey. Respondents gave various reasons, with many of them confident because of family and friends' support, living conditions, and financial security, the survey found. The findings raise concerns about retiring, as people think they can rely on retirement benefits while experts warn of problems with Social Security and pension, a psychologist says.--USA Today
How to figure out your real cost of living in retirement
Retirement planning starts with knowing the actual cost of living, which varies among people, according to CNN Money. As such, clients are advised to keep track of their spending for at least a year before hitting retirement to get an accurate idea of their expenses. While dedicated online tools, such as Mint, or electronic spreadsheet can be used in recording the expenses, clients may also look into their checking and credit card statements to estimate the costs for housing, transportation, and other budget items. --CNN Money
How to invest like Warren Buffett
Unlike Warren Buffett and a minority of investors who react to a bull market by becoming more cautious and selling stocks, most investors respond by buying stocks way past the price peak, incurring losses in the end, according to researchers. Clients can invest as Buffett does if they opt for conscientious rebalancing that allows them to sell off assets with rising value and hold assets that have falling value, MartketWatch says. Investors who do practice rebalancing hold a 1.5% advantage over the stock market for the past 15 years, says an expert. --MarketWatch
People ignore 80% of what their advisor tells them. Heres why
Clients tend to shrug off 80% of the financial advice they receive from professionals because the advisors fail to know the clients fully, according to the article. Financial planning professionals are expected to get all pertinent information from their clients and to work closely with them to define their personal and financial goals based on their values, attitudes, and expectations. This means that financial planners will need to get more personal to give the best financial advice to their clients. --CNN Money
A retirement planning lesson from a bike ride
Hyperbolic discounting and unrealistic optimism are two ideas in behavior finance that are useful in retirement planning, writes a consultant. In this article, the expert mentions how these two concepts came into play when he and his wife had to decide when to return the bikes they rented after using them. The expert stresses the importance of making a plan for the future and how tricky retirement planning can be because of life's uncertainties. --CBS Moneywatch
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