Existing risk tolerance models have done nothing to help investors with any equity exposure this year, and with so many clients’ assets depleted by the market downturn, advisers are trying to find a new way to assess risk. That was one of the key findings of this year’s Retirement Indicator survey, of 212 financial advisers, sponsored by Brinker Capital.

“Our year-end results make obvious what most advisers feared—that their clients’ retirement security has been severely jeopardized by ongoing market deterioration,” said John Coyne, president of Brinker Capital. At the beginning of this year, only 54% said their clients were not on track to a timely retirement. Now, that is 88%.

Of the respondents who now say their clients are off track, 74% said it will take between one and five years to make up the retirement savings shortfall. Ninety-seven attributed this to the market and 51% to clients not starting to save early enough.


Interestingly, 75% advisers noted that there is a disconnect between the level of risk tolerance their clients admitted to when they began their association with them, and today. All of these advisers say they now need help reassessing clients’ risk tolerance.

Sixty-five percent of the advisers surveyed said their clients have become more vocal and involved in their investments. Only 31% are neutral and 4% less vocal, the advisers said. Along these lines, 67% of the advisers surveyed now believe in full fee disclosure.

Disturbingly, 44% of their clients are tapping into their retirement savings—far above other reports.

Perhaps because of the unpredictability of the market, 92% said the government should stay out of the management of 401(k)s.

Brinker Capital is making the report available through Jemile Dragovic at: jdragovic@middlebergcommunications.com.

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