Given that the Baby Boomer generation is a very large one – with a population of more than 77 million in the United States in 2008 – financial professionals should ensure that they are meeting their unique needs. About 10,000 of them turn 65 every day, so catering to them is no small task.
Transamerica Center for Retirement Studies® conducted a survey of over 1,400 Baby Boomers, born between 1946 and 1964 to get their perspective on retirement. They are challenging the typical definition by working well into their retirement years, with some not planning on quitting at all. Many seniors cite income or health benefits as the reasons to keep going. This is not uncommon to hear these days, especially since the Great Recession.
In order keep opportunities available in the workforce, 67 percent of seniors indicated that their goal is to stay healthy, others noted high job performance or keeping their skills up to date. Only five percent said they were considering additional education. It’s important that Baby Boomers have a plan in place if retirement should happen sooner than they would like due to job loss or illness.
Retirement savings shortfall
Among those surveyed, the median savings for retirement is just under $150,000. This savings shortfall sheds some light on why only 24 percent, according to the Insured Retirement Institute are confident that their savings will last the duration of their retirement. With only 33 percent relying on pensions as a source of income in retirement, the majority of those surveyed are expecting Social Security to be a source of income , as well as savings and investments from 401(k)s, 403(b)s, IRAs, or other sources.
Savings are great, but there are more ways to increase finances and have a happier, more comfortable retirement. Now is the time to demonstrate the value of life insurance products that offer consistent retirement income. There are several types of products that fall under this category, and baby boomers are still able to purchase many of them.
Using a product like indexed universal life can supplement retirement income with life insurance products that will provide long-term security. The benefits of this approach are twofold, because the client can potentially receive additional tax free income or secure an immediate lump sum to survivors if they pass prematurely. Advisors can educate Baby Boomer clients on the various types of financial products that could help them in the future. Paying close attention to boomers and ensuring that their needs are met is beneficial for everyone. Talk to your Baby Boomer clients today and find out their plans for retirement and how you can help.
Editor’s Note: This post was originally published in May 2014 and has been reviewed and updated.