Technology Can Help Your Clients Start Planning for Retirement

What You Need to Know

The biggest financial enemy clients face is a failure to plan.
Tech can get clients moving.
Tech can also give clients a way to see how all of their assets fit together.

Americans are worried about making the right decisions about saving and investing.

In fact, most are more afraid of running out of money than death.

The majority of Americans (61%) who participated in the 2023 Annual Retirement Study conducted by my company, Allianz Life Insurance Company of North America, said they are more afraid of running out of money than death

Many worry about saving enough or investing in the right assets.

At the same time, factors outside of their control, like market volatility and inflation, could also cause them to lose money.

Essentially, there is a crisis of confidence. Americans worry if the actions they are taking to prepare for retirement will actually work — or if they will work well enough.

Advisors can use tech to help clients feel more confident may be more successful.

Assessing Financial Trade-Offs

Everyone must make trade-offs when creating a long-term financial strategy.

A client’s priorities can help make these decisions.

For example, some clients may choose to work longer, while others may choose to reduce their spending in retirement. Others may prioritize a dependable retirement income strategy over higher returns and the stress of market volatility.

Clients have four main controllable factors for their retirement strategy: retirement age, contributions, level of income needed and asset allocation.

Even if they retire later, contribute more to savings and withdraw less, they still face uncontrollable risks.

Advisors can use that fourth factor — asset allocation — to address risk.

Client Stress-Testing

Fintech can help advisors understand how a product and its features perform and how incorporating it into an overall portfolio would affect specific clients’ probability of success.

This is particularly helpful when assessing trade-offs.

Clients today must ensure that they have contingencies built into their retirement strategies for concerns like longevity, taxes, inflation, and sequence-of-returns risk.

With the right kind of technology, advisors can stress-test financial strategies with some of these uncontrollable risks.

Advisors can demonstrate how products like annuities that are built to help mitigate the risk of longevity and market volatility would affect a portfolio.