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Of the Many Paths to Retirement, Affluent Americans Continue to Trust the Human Touch

Of the Many Paths to Retirement, Affluent Americans Continue to Trust the Human Touch

When it comes to good financial habits, such as saving early and creating a solid financial plan, who’s leading the pack? The answer might surprise you.

A new D.A. Davidson survey of over 1,000 affluent Americans reveals the ages at which respondents started saving for the future, offers insights into how many Americans have a written, long-term financial plan, and explores how different generations are working with financial advisors.

A Generational Divide

The majority of affluent Americans indicated that they started saving before age 35, but Millennials have done particularly well. A full 95 percent of Millennials say they began saving before their 35th birthday, compared to 75 percent of total respondents.

A second generational divide arose when respondents were asked about having a financial plan. Younger adults again appear to be the stronger planners, with almost three-quarters (74 percent) of Millennials saying they have a written, long-term financial plan, compared to 54 percent of Gen X and 45 percent of Baby Boomers.

Optimistic or Pessimistic?

Even with a good track record of planning and saving ahead, Millennials appear to be less than optimistic about how well they might fare financially once they reach retirement. More than one-third of responding Millennials (36 percent) expect to carry debt into retirement and 38 percent plan to start a new business in retirement. The good news: Gen X and Baby Boomer respondents appear to be on track for slightly less debt, with 20 percent and 27 percent planning to carry debt into retirement, respectively.

As they look to the future, Millennials also expect to have additional, costly burdens: supporting an adult child and/or an aging parent financially. While the majority of total respondents said they do not anticipate providing such financial assistance, 61 percent of Millennials believe they will support an adult child and 66 percent think they will support an aging parent.

The Role of the Advisor

Other findings from the new survey indicate that affluent Americans prefer a human touch for managing their money. When asked about working with a financial advisor or with a robo-advisor, fewer than 5 percent of respondents said they use a robo-advisor for most of their investments. More than half (59 percent) of respondents turn over the bulk of their investments to a traditional financial advisor. They also have contact often enough to have memorized how to reach their advisor or access their accounts: 40 percent of respondents have their financial advisor’s phone number memorized and 66 percent know their account log-in information.

At D.A. Davidson, we encourage all investors to make prudent financial decisions, such as starting to save for the future while still young and creating a written financial plan to serve as a guide for your future. Whether it is helping our clients to create a solid strategy, manage debt or plan for their legacies, our financial advisors can provide personalized advice, guidance and solutions designed to meet each person’s objectives.

More details about the 2019 D.A. Davidson survey and methodology can be found here.

D.A. Davidson & Co. is a registered broker-dealer and registered investment adviser that does not provide tax or legal advice. Information contained herein has been obtained by sources we consider reliable, but is not guaranteed and we are not soliciting any action based upon it. Any opinions expressed are based on our interpretation of the data available to us at the time of the original article. These opinions are subject to change at any time without notice. Copyright D.A. Davidson & Co., 2019. All rights reserved. Member SIPC.


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