As Baby Boomers head toward retirement, they will likely decrease the number of relationships they have with financial institutions and reshape the entire industry, according to new research from the Retirement Income Industry Association.
Boomers will discover in coming years that they not only need fewer financial relationships, but also need a new set of services. This transformation may occur over a much shorter timeframe because of the recent tumultuous market events.
"This is a life-stage phenomenon made more dramatic by the sheer number of Boomers in retirement and entering retirement," said Larry Cohen, vice president and director of DRI Consulting Business Intelligence and co-author of the study for RIIA called, Financial Institutions and Retiring Boomers: Convergence's Payoff or Payback?
"When Boomers reach the empty nest stage, they discover that they no longer need all of the financial relationships that they have accumulated over 40 years of homebuilding and career development."
Boomers will also discover they need a new set of services which will result in even more cuts in the number of financial relationships and the transference of assets to a smaller number of firms that can meet Boomer needs, Cohen added. Plus, this transformation may occur over a much shorter timeframe due to the tumultuous events in the financial markets.