Speaking to columnist Veronica Dagher from the Wall Street Journal’s Financial Adviser, David Giertz had some information for financial advisers and clients as to the importance of communicating about Social Security benefits. Specifically, those approaching retirement age.
The Nationwide Financial Retirement Institute conducted a survey that showed 86% of those approaching retirement were unable to correctly identify what factors would determine the amount of their Social Security benefits. This is important, David Giertz explains, not only for the clients – but for advisers client retention as well. “4 out of 5 people would change advisers if their adviser wasn’t talking about Social Security” he stated.
Part of this, he says, may be due to the overall vastness and complexity of the rules governing Social Security, which may create apprehension and a lack of confidence in addressing it. However, with Social Security being as much as 40% of an individual’s retirement income it is often crucial for financial advisers to help their clients understand the importance of when to accept their Social Security benefits. Turning your benefits on too early could result in a reduction, costing up to $300,000 over a twenty-five year period, or $12,000 per year or $1,000 per month.
Failing to optimize benefits at this magnitude could be devastating to an individual’s retirement goals. This ‘land-grab’ mentality is one many advisers see and must continue to keep their clients informed about when planning for their retirement.
Mr. Giertz has served with the Nationwide Investment Services Corporation family of companies since 2006. He is currently the President of Nationwide Financial Distributors, Inc. and Senior Vice-President-Nationwide Financial Distribution and Sales at Nationwide Life Insurance Company.