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You’re More Likely to Have Guaranteed Retirement Income If You Do This


A new study by the financial services company Allianz says that a higher percentage of Americans working with financial advisors buy products that provide guaranteed sources of retirement income. That’s compared to folks who’ve never used a financial professional. The study also revealed that a higher percentage of individuals who work with financial advisors are researching expenses and risks associated with retirement income. Let’s take a look at how beneficial financial advisors are for consumers’ retirement goals.

Whether you are looking for retirement or investment advice, a financial advisor could help you create a financial plan for your needs and goals.

What Allianz Says About Working With Financial Advisors

According to the 2022 Retirement Risk Readiness Study from Allianz Life Insurance Company of North America, a higher percentage of Americans working with financial advisors (49%) are buying financial products that provide guaranteed sources of retirement income than those who haven’t had a financial advisor (15%).

The study also found that those working with a financial advisor were more likely to prepare for the rising costs of inflation, which has hit the consumer staples sector hard in 2022.

Additionally, the study reveals that a higher proportion of individuals (53%) who work with financial advisors are researching expenses and risks associated with retirement income when compared with 26% of those who do not engage in advisory services.

And professional guidance can also likely add other positive perks. A larger subsection of individuals who work with financial advisors (57%) are making investments less risky when compared with 25% of those who don’t have financial advisors.

“So many Americans are in a vulnerable spot right now with their finances, it’s encouraging to see the high value placed on not only the practice of financial planning, but also the guidance of a financial professional,” said Kelly LaVigne, vice president of Consumer Insights at Allianz Life, in a statement.

Smart Asset: A Financial Advisor Makes You This Much More Likely to Have Guaranteed Income

Top Retirement Risks That Worry Americans

With the prospect of a recession looming and Americans saving money to keep pace with rising inflation (8.6%, the highest since 1981), many people believe they need guaranteed income to weather retirement costs in the future.

The Consumer Confidence Index, which measures how optimistic or pessimistic consumers are regarding their financial situation, dropped to a 16-month low in June 2022 as Americans have grown increasingly worried about high gas and food prices and the possibility of another recession.

And some also believe that they may work well past the current Social Security retirement age. According to the Retirement Risk Readiness Study, 59% of near-retirees are planning to work past 66, while 11% currently in retirement have already done so.

Furthermore, near-retirees (40%) and preretirees (35%) believe that people will get enough from Social Security to meet retirement needs. But only 10% of retirees think that’s the case. And 25% of retirees are also looking to maximize their Social Security benefits.

How to Get Guaranteed Income in Retirement 

For folks looking to maximize or get retirement income, three common sources include:

  • Social Security. Government benefits may provide seniors with income after retirement. But workers looking to retire early might have second thoughts. Claiming Social Security before full retirement age will cut significantly into your benefits. Waiting until retirement age to claim Social Security benefits can maximize payouts in subsequent years.
  • Annuities. Buying into annuities can supplement government benefits with a pension-like income stream. Annuities may bring peace of mind, but they come with tradeoffs, so think carefully about whether this financial vehicle is right for you.
  • Pensions. Some companies offer a pension, or a defined-benefit plan, which can provide income for employees after they retire. These have become increasingly rare over the years, so perk up your ears if a prospective employer offers one.

Some, or all, of these financial vehicles may be available to you. And they may be accompanied by tradeoffs when it comes to taxation, risk and returns. It makes sense to verify that any retirement income strategy complements your overall financial approach.

Smart Asset: A Financial Advisor Makes You This Much More Likely to Have Guaranteed Income

Bottom Line

With the uncertainty of inflation, the prospect of a recession and the COVID-19 pandemic, consumers are looking for answers on how to save for the future. Folks who work with a financial advisor are accessing retirement income products at higher rates. And looking for additional sources of income can help make your retirement more sustainable.

Tips for Retirement Saving

  • SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
  • SmartAsset’s free 401(k) calculator can help you determine how much you can expect your savings to grow over time and how much you may have when the time comes to retire.

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