The survey, conducted among 440 certified financial planners, indicates that 69% of clients have become increasingly worried about affordability in the past year, with 78% expressing concerns about Social Security's sustainability and 73% about Medicare. The inflation rate of 3.4% as of August, exceeding the Federal Reserve's target, exacerbates these worries.
Many clients are reacting by making hasty financial decisions, such as early withdrawals from retirement accounts or reducing contributions, which could undermine their long-term financial health. Financial advisors are recommending proactive measures, including stress testing financial plans and building emergency savings, to help clients navigate these challenges.
Despite the looming midterm elections, most advisors do not anticipate significant impacts on their clients' financial situations from the electoral outcomes, although many expect to adjust clients' plans in response to ongoing affordability issues