Not that long ago, most widely accepted predictions held that as Baby Boomers inched toward a retirement funded largely by their 401(k) plans, most of them would seek a one-on-one relationship with a financial advisor to manage their nest eggs. Instead, research firms say a fairly steady or even growing portion of investors — surveys put it at somewhere between one-third and two-thirds — are going the do-it-yourself route, a recent Wall Street Journal article reported.
Four main factors are driving the growth and strength of the DIY market:
• a proliferation of increasingly sophisticated online calculators and low-cost online trading alternatives
• new a-la-carte advice services from the larger, full-service financial firms chasing the rollover market
• the effects of the 2008 stock market drop and continued turmoil in the market
• instances of widely publicized financial fraud — the “Madoff Effect”
One way to attract DIY investors, a recent Deloitte report suggested, is for firms to position themselves as “facilitators and enablers” to those who want to be in charge of their retirement planning.
What’s your opinion of the growth of DIYers and the implications of the Deloitte report? Share your thoughts in the comment box.
