Running out of money in retirement remains a primary concern for those planning their transition out of work, with other major concerns being maintaining their lifestyle and the rising costs of healthcare expenses. This is according to the American Institute of CPAs (AICPA) and its Personal Financial Planning Trends Survey.
Exhausting their money is the most prominent concern among clients planning retirement, according to 30 percent of Certified Public Accountant (CPA) financial planners. This figure actually illustrates an improvement, however, since the percentage figure that AICPA’s 2016 survey yielded was higher, at 41 percent.
“This is likely due to the economy’s steady improvement over the last few years, with the stock market continuing to climb despite volatility,” the study’s accompanying press release said.
Clients’ second most prominent financial concern was maintaining their current lifestyle and spending levels, with a recorded response rate of 28 percent. At a distant third is a concern relating to rising healthcare costs, which was recorded as a prime concern of 18 percent of respondents.
However, the concern around healthcare costs has increased when compared to the 2016 survey, which recorded a response of only 11 percent.
48 percent of all clients recorded having a concern relating to whether or not they would outlive their money, which is higher than the 39 percent of planners who recorded concerns about their clients about their clients outliving their money.
“A sophisticated financial plan takes into account both the client’s financial and emotional concerns,” said Andrea Millar, Association of International Certified Professional Accountants Director of Financial Planning in the survey’s press release. “To mitigate the fear of the unknown, CPA financial planners map out a wide range of future scenarios, establish long term goals and work with their clients to ensure they have adequate coverage to cover the healthcare costs that may crop up in their retirement ahead.”
Even with a number of concerns present, the AICPA characterizes the overall retirement picture for clients served by CPA financial planners as “improving.”
“When asked to compare their clients’ current situation to five years ago, half of CPA financial planners (50 percent) say their clients have more confidence they’re ready for retirement. That outweighs the third (33 percent) that stated they find their clients to be less confident. Another 17 percent saw no change,” the press release notes.
For more information, find the AICPA’s official press release and infographic related to the survey here.
