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Tackling Retirement Literacy with the Quick Financial Plan

Joe Buhrmann April 12, 2022

‘How much do I need to save for retirement?’ is the primary question that often spurs people to take a longer-term, more holistic view of their finances. While many understand the significance of retirement planning, when the necessity trails from spending today’s dollars to managing tomorrow’s money, a lack of expertise and skill can lead to indecision or inaction.

Room for Improvement in Retirement Literacy and Planning

According to a Fidelity Investments State of Retirement Planning Study, which spoke to a national sample of over 1,000 adults who are not yet retired, just 25 percent of respondents accurately identified the expert recommendation to have 10-12 times your last full year of working income saved by the time you reach retirement.1

Financial professionals who can quickly address retirement readiness to prospects and existing clients have an opportunity to engage this audience and highlight value in both retirement and broader financial planning.

Solving for Retirement Needs with a Quick Financial Plan

Time and time again—across all facets of life—we see examples of how preparation and planning leads to better outcomes. Interestingly, the State of Retirement Planning Study found that those who approach retirement with a blueprint or a plan in place have greater peace of mind that they’ll weather market volatility, and are more confident that they’ll be able to retire when and how they want to.1

To help those in need, you want to achieve a straightforward understanding that the client’s planning situation will fall under the following actions: saving more, spending less, or retiring later.

Developing a picture of both the client’s base needs and the resources they have available will quickly show how they work together. And it will also reveal whether the outlook can be improved. For the quick financial plan, you can keep data inputs to a minimum to at least obtain the 15,000-foot view for the client:

  • Age
  • Desired retirement age
  • Income
  • Retirement and other big-bucket asset figures
  • Social Security

Imagining a Comfortable Retirement

Further evaluating options around the retirement goal will require the financial professional to make several assumptions about how to align the desired retirement age with the desired lifestyle.

While income history can be used as a predictive measure to gain insight around future needs, there is often more to uncover about by the client’s expectations for their retirement, such as access to family or community, or top-quality health care. Discussion around different lifestyle choices helps to explore a broad array of circumstances surrounding the client’s financial life and their values.

Modeling these different scenarios within planning software can be extremely helpful to produce comparisons and tradeoffs. A visual representation of success, or a “plan score”, can effectively convey to clients whether their needs are fully funded, prompting action where necessary.

These additional data points provide a great opportunity to make the retirement conversation inspirational: What can retirement look and feel like to the client, and what matters along the way?

Educating Clients About What Could Affect Their Retirement

To build upon the financial confidence that accompanies a plan, it’s essential to discuss plan assumptions and the accompanying factors that could disrupt those. In this way financial professionals help clients better understand the areas that can impact their plan success.

For example, how do taxes, medical costs, inflation, and expected benefits from Social Security influence clients’ retirement needs? While it’s true that the Full Retirement Age (FRA) has changed over the years and needs to be confirmed against your birth year, just 17 percent of respondents in the retirement planning study correctly identified their FRA.1

Financial professionals should set expectations around what assumptions—capital market returns, Social Security benefits, inflation, and tax rates—have been built into the plan. When clients understand these factors alongside their needs and resources, then they will have a better grasp on how their activities or decisions could put the plan at risk.

In addition, keeping clients informed with regular updates about the broader regulatory, market, and societal effects that could shape their retirement plan keeps them engaged with the plan and its expected outcomes.

Planning to Meet Retirement Needs

There’s no question, with retirement a high priority for so many, the time is right to start the planning conversation. And while people are living longer, in many cases today the pre-retirement situation is also becoming more dynamic. People may have more than one retirement account, and a mix of assets and investment vehicles to help them save.

Planning software can be a useful tool to help financial professionals start the planning discussion, to construct a financial plan, and to help maintain an ongoing narrative to optimize the plan.

For more information on planning software and the efficiencies you can gain during the planning process, watch the presentation below to see how a technology-based financial planning structure can enhance engagement, improve the overall client experience, and drive growth within your practice.



1 Fidelity Investments, “State of Retirement Planning Study,” 5-12 February 2021, n=1,204.


The eMoney Advisor Blog is meant as an educational and informative resource for financial professionals and individuals alike. It is not meant to be, and should not be taken as financial, legal, tax or other professional advice. Those seeking professional advice may do so by consulting with a professional advisor. eMoney Advisor will not be liable for any actions you may take based on the content of this blog.

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About the Author

Joe serves as a Senior Financial Planning Practice Management Consultant at eMoney Advisor. With more than three decades in the financial services industry, Joe aligns his know-how and passion to help firms of all sizes increase usage, adoption, and engagement through a modern financial planning experience. He leverages his expertise and supports internal departments across the enterprise, helping Communications, Marketing, Relationship Management, and Sales. Joe attended Illinois State University, where he received his bachelor’s degree in Applied Computer Science and his MBA.

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