Older Investors Think They're Ready to Retire. Advisors Disagree.

Financial advisors have significantly different perceptions of their clients’ retirement readiness than do the clients themselves, according to Allspring Global Investments’ annual retirement survey, released Tuesday.

While some two-thirds of retirees and near-retirees considered themselves ready for retirement, only 40% of advisors, who were included in the survey for the first time, said their clients were ready. 

The disparity was especially acute around specific retirement topics. For example, when asked whether they know enough about Social Security to be prepared for retirement, 44% of near-retirees and 54% of retirees said they did. Only 10% of advisors agreed. 

Similarly, 30% of near-retirees and 46% of retirees said they know enough about Medicare planning. Only 8% of advisors thought they did.

“This report suggests investors are entering retirement less prepared than they think they are,” Ron Cohen, Allspring’s head of defined contribution investment only distribution, said in a statement. “However, only about half of near-retirees have used a paid financial advisor to help plan their retirement journey.”

Escalent conducted the survey in September among 1,515 adult U.S. residents who are primary or joint household financial decision-makers. The sample comprised 752 near-retirees (average age of 61), 763 retirees (average age of 70) and 320 advisors with at least $5 million in assets under management.

Transitioning Into Retirement

The survey analyzed attitudes and behaviors around planning, saving and investing for retirement.

Deciding when to retire is a highly personalized choice that depends on factors including financial resources, health and job satisfaction, according to Allspring. Survey participants’ average retirement age was 62, but their responses turned up mixed opinions and expectations of the right time to leave the workforce.