With 76 million baby boomers nearing retirement, there are now more opportunities than ever for financial advisors. By consulting with both younger and older segments of this generation to help them envision the retirement of their dreams, and develop and manage a strong foundation of retirement assets to fulfill those desires, the advisor will surely catch the wave.

Almost everything about retiring today is different from the previous generation. On the plus side, people are living longer than ever before. But with longevity comes the new risk of outliving one’s assets. Plus, healthcare costs are rising and sources of retirement income are shifting away from fully funded pension plans and Social Security to retirement plans and income products that your clients need to fund themselves.

In dealing with clients, it is extremely important to see the forest through the trees. Many people may not have been investing in traditional retirement-oriented products, but are nonetheless sprinting to the finish line. As baby boomers retire, many of them will get the largest sum of money that they’ll ever have via a 401(k) rollover, sale of a business, or even the sale of a home, says Chip Roame, managing principal of Tiburon Strategic Advisors, a Tiburon, Calif.-based research and consulting firm.

“The advisor’s opportunity is to get that money when it liquefies.” To do that, he says, you need to consider not only a client’s needs today, but also his or her potential needs in the future. A client who may now have only a little bit to invest could be an enormous boon to your business upon retirement. A sold business or a rolled over 401(k), for example, could be enormously profitable, says Roame.

The Asset Base is Enormous
To be sure, the stakes are high. Consumer households have $19.8 trillion of assets to invest, combined with another $7.5 trillion of retirement plan assets, $12.4 trillion of personal assets and $9.6 trillion of other illiquid assets to total $49.3 trillion of assets, according to Tiburon Strategic Advisors.
           
According to data from Tiburon, 40 percent of the assets available for investment are held with advisors, while 30 percent are in retirement plans, endowments and foundations, and the remainder represents self-directed investments. Independent advisors, meanwhile, continue to outpace the competition in terms of asset growth.

The assets are certainly growing. The mutual fund industry, for example, now boasts $10.8 trillion of assets, while the cash value of life insurance policies amounts to another $3 trillion of assets. In addition, annuities and hedge funds both represent another $1.8 trillion each, according to Roame.

Capturing Funds as They Enter the Market
This leaves a big opening for advisors to bring in heaps of money over the next 10 to 12 years as the baby boomers start to retire. Not only will 401(k) assets need to be rolled over, but also as baby boomers are getting wealthier, more of them are seeking advisors to handle their more complicated finances.

The opportunity is evident. By assisting current and potential clients in overcoming today’s challenges to meet evolving retirement needs, financial professionals can develop loyalty and ensure their clients’ asset bases lasts their lifetime. What better way is there to differentiate your business from the competition and be called upon to manage a larger percentage of the $49.3 trillion asset base?
           
“It’s a great opportunity for advisors,” says Roame. “Their business should be great for the next 20 years.”