Advisors want more Social Security helpNews added by Benefits Pro on July 9, 2014

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Joined: September 07, 2011

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By Chuck Epstein

Retirement plan advisors are hungry for more information on Social Security to help their clients meet their income needs in their post-work lives, according to a report by Practical Perspectives, an independent consulting and research firm.

The report, “Social Security Support and Financial Advisors — Insights and Opportunities 2014,” asked 600 advisors in May how they typically address Social Security issues with clients. The survey, also conducted by GDC Research, asked what types of support financial advisors currently get from product manufacturers, distributors and specialized service firms.

The report found that 90 percent of advisors deliver a degree of Social Security advice to clients, with about 75 percent saying they would like to receive more support on Social Security-related questions, as well as content or tools related to Social Security in the next year. It found that 62 percent of advisors say clients are highly receptive to discussions regarding Social Security.

The report concluded that “most advisors still need to enhance their knowledge and skills on this increasingly important topic and are looking for greater support from product and service providers.”

While the study did not directly address the future of Social Security, it did ask advisors: What are the challenges in discussing Social Security with clients? According to Howard Schneider, president of Practical Perspectives, “one of the top challenges is that clients do not believe they will receive benefits as promised.”

Among the other highlights from the study are:
  • Advisors rely primarily on free support tools from the Social Security Administration, including its online calculators and planning software. Only 13 percent of advisors use subscription-based Social Security tools, and over half of advisors said they did not want to pay for additional support. The study found the most recognized providers of Social Security information are MoneyGuidePro, BlackRock, the Social Security Administration, Horsesmouth and Social Security Analyzer.

  • While about 90 percent of advisors discuss Social Security with clients, discussions varies around these three themes: advisors who focus on education and information (26 percent); those who use different Social Security scenarios, but don’t recommend a specific approach (30 percent); and those who recommend specific Social Security claiming strategies (36 percent). About 8 percent of advisors indicated they do not discuss Social Security with clients.

  • Over 60 percent of advisors who provide clients with Social Security scenarios or recommend specific strategies said they were willing to pay a fee, compared to less than half of advisors who focus mainly on education.

  • Nearly half of advisors who participated in the survey said they attended a presentation on Social Security at an off-site conference or meeting, while about 33 percent said they used webinars, wholesaler presentations or a conference call to get more information about Social Security.
Discussions about Social Security are considered a marketing approach to strengthen client relationships, but it is not being used as a way to build new business, the study found. But when Specific Social Security strategies are used with clients, that combination of financial planning incorporating Social Security strategies is considered a good marketing tool, the study said.

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