Pre-retirees don't know how much they'll need: SEI

FWR Staff

31 July 2008

Bank wealth managers say clients are too vague on their retirement goals. Many affluent investors who are approaching retirement age haven't got the slimmest notion how much they need to fund their post-work lives, according to an SEI survey of bank-based wealth managers.

Maybe worse, advisors to well-to-do pre-retirees are plagued with uncertainty about their retirement goals and lifestyle aspirations.

Spending levels

The survey, based on "quick polls" of 31 wealth managers taken at SEI-sponsored presentations on asset management in the private-banking milieu, found that 42% of bank-channel wealth managers say their clients' biggest worry is uncertainty about their retirement goals. Even more -- 61% -- said their clients may have decided they know what they need to live as they would like in retirement, but the numbers they pick are generally far short of the mark.

"It's quite clear from these survey findings that investors have a difficult time identifying what their retirement is going to look like and how they're going to pay for it," says David Campbell, a senior v.p. in SEI's Private Banking Group. "Mere accumulation isn't enough. Wealth-service firms need to address this concern with investment approaches that are strategic and focused."

Clients also worry about their saving and spending levels in retirement. As a result, the wealth managers SEI polled find they have to work with clients to get updates on their goals and retirement plans.

Meanwhile the wealth managers surveyed indicated that the down economy has had an effect on their clients' approach to investing, with many of them looking to control downside risk.

SEI, an Oaks, Pa.-based manager of managers and investment-management processor, administers $420 billion in mutual fund and pooled assets and manages $178 billion in assets. -FWR

Purchase reproduction rights to this article.