Advisors Say They Cover Key Retirement Topics, But Clients Disagree — New Research Highlights The Disconnect

New research by David Blanchett, managing director at PGIM DC Solutions, reveals significant disparities between the retirement planning services financial advisors believe they’re providing and what clients actually report receiving. This gap highlights areas where advisors need to improve their communication and service delivery.

For example, while 97% of advisors claim to discuss Required Minimum Distributions (RMDs) regularly, only 54% of clients report experiencing such conversations. Advisors need to ensure clients understand the importance of RMD planning to avoid penalties and optimize tax strategies.

In terms of retirement lifestyle planning, 70% of advisors say they frequently discuss how clients will spend their retirement time, but only 29% of clients recall these conversations. Emphasizing the non-financial aspects of retirement planning, including social connections and healthy habits, is crucial in helping clients have a good retirement.

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There’s also a gap in the perceived importance of wealth protection and lifetime income products between advisors and clients. Addressing this discrepancy will help advisors better align with their clients’ needs and expectations.

Tax minimization is another area of concern, with 95% of advisors reporting they provide such strategies, but only 64% of clients acknowledging this guidance. Significant gaps also exist in discussions about monthly budgeting and account withdrawal strategies. Advisors should provide more granular guidance in these areas to help clients better prepare for their financial future.

To bridge these gaps, improving communication is crucial. Advisors should consider developing more tactical approaches to address specific retirement issues, ensuring clients understand and remember the guidance provided. Implementing comprehensive checklists or materials that cover all key aspects of retirement planning can help ensure thorough coverage of essential topics. Regular follow-ups to review and reinforce important retirement planning concepts can also help bridge memory gaps.

Ultimately, advisors should strive to provide more comprehensive retirement planning services that align with clients’ expectations and needs. By addressing these areas, financial advisors can better meet their clients’ retirement planning needs and ensure a more aligned understanding of the services provided.

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