Have a net worth of $1 million or more It doesn’t have the aura of extreme wealth it once did.but it’s still a pretty tidy amount — especially considering: Average retirement savings in the US is less than $90,000. Still, a report from Northwestern Mutual found that a significant percentage of billionaires worry that the wealth they’ve amassed won’t be enough to last them a lifetime.
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Northwestern’s 2023 Plans and Progress Surveyis based on a poll of 2,740 U.S. adults and found that one-third of billionaires surveyed believe they can outlive their savings. did. In this case, “billionaire” means her investable assets exceed $1 million.
Almost half (47%) of millionaires say their financial planning still needs improvement. This is true despite the fact that 42% consider themselves “highly disciplined” planners, which is more than twice as high as the general population. What’s even stranger is that 70% of wealthy Americans work with professional financial advisors, yet one-third are worried they’ll run out of money in retirement.
Wealthy Americans may not be confident they have the right financial planner in-house
One problem is that many wealthy people aren’t sure if they hired the right financial advisor in the first place. Nearly half (48%) of high-net-worth individuals who work with an advisor say their current advisor can provide more comprehensive financial guidance if they’re looking for a change, according to Northwestern research. I said I would choose another advisor. About a third of them (34%) think they would switch to someone who better understands their life stage and priorities.
“It’s prudent for high-net-worth individuals to seek a second opinion on the strength of their financial plans,” Aditi Jhaveri Gokhale, an executive with Northwestern Companies, said in a news release. “Times of uncertainty like the current ones are causing people to take inventory of the choices they’ve made and reconsider whether an advisor is right for them. More affluent Americans are looking at individual financial products. We expect this trend to seek a second opinion to grow even further, as more and more people intentionally seek comprehensive financial advice instead of financial advice.”
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The Northwestern University study isn’t the only study raising concerns that retirees will outlive their money. CNBC reports that a previous study by Cerulli Associates found that more than half (58%) of retirees and retirement savers are concerned about the longevity of their assets. This is an especially big concern for baby boomers and their Gen Xers who have reached or are approaching retirement age.
These concerns have caused 46% of workers to retire later than expected to meet their income and savings needs, according to Cerulli research.
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This article was first published GOBankingRates.com: Even though 70% of millionaires use a financial planner, a third are likely to outlive their savings — here’s why
