According to the 2Q 2009 issue of the Cerulli EdgeRetirement Edition, and recent investor-focused research published by Cerulli, 83% of all households today are most concerned about not having enough money to last through retirement. And, while there has been a flood of products to hit the market recently, the process of retirement income planning has yet to be addressed.
Cerulli believes it is not the product, but the process that will bring consumers successfully through the stages of retirement (pre-retirement, early retirement, prolonged life span).
“More standardized, end-to-end processes, using hybrid insurance-asset management approaches are emerging, which is a good sign that the industry is starting to think differently about how to address consumers’ greatest concern,” says Tom Modestino, senior analyst at Cerulli.
The 2Q issue of The Cerulli EdgeRetirement Edition further explains that the most successful firms will consider product development in terms of the products suitability in an integrated income-planning process. It will be about refining today’s ‘silver bullet’ retirement income product ambitions to focus more on being the best solution in one or more defined sleeves of an investors retirement life based on their wealth tier.
“There is a forced break in the product development frenzy at many asset management and insurer firms, which are dealing with fewer resources due to the market downturn. This is, perhaps, a good thing for the industry as firms are taking a longer, more conscientious approach to their strategies–54% of asset managers are still conceptualizing their retirement income solutions–versus rushing to market with next product idea,” continues Modestino.
L.D.