Oppenheimer: Boomers Clueless on Investing Techniques

An OppenheimerFunds news release said two in ten of those contacted in a new Oppenheimer survey consider themselves very knowledgeable about asset allocation or dollar cost averaging. A third of respondents say they are somewhat knowledgeable about asset allocation, dollar cost averaging, or growth style investing.

“We are concerned that Boomers’ lack of knowledge is hindering their long- term retirement planning efforts,” said Jim Ruff, President of OppenheimerFunds Distributor, in the news release. “If knowledge does not increase, we could see many Boomers finding themselves unprepared for the costs associated with retirement.”

When asked what one piece of information or advice would be most helpful in saving for retirement, 39% of Boomers indicated advice on investment techniques including selecting solid investments and asset allocation strategies. Also, one in five (22%) indicated they would be helped by a professional calculation of how much they should try to save.

While most surveyed have a retirement goal in mind, seven in ten respondents say it is only a general idea of how much they will need; fewer than two in ten have a specific dollar amount in mind. This may help explain why, contrary to retirees’ reported experiences, half of the non-retirees expect that they will spend less money in the first few years after retirement than they spent before they stop working. Only half of those surveyed have a written financial plan, with women more likely than men to have one. Men, however, were more likely than women to have an exact dollar figure for savings goals in mind.

While almost 70% of respondents make more than half of their investment decisions on their own, a scant 5% consider themselves excellent investors and four in ten describe themselves as good investors.

Investors appear to say one thing and do another, when it comes to asset allocation strategies. Despite the fact that non-retirees and retirees surveyed report roughly similar ideal asset allocation approaches, three quarters said that retirees should invest retirement savings differently than people who are working.

The nationwide survey was conducted between September and October 2004 and was designed to study the financial behaviors and attitudes of 1,000 retirees and pre-retirees, most of whom are Baby Boomers. Those surveyed were Americans ages 45 to 75 with annual household incomes of at least $75,000 or household savings and investments of at least $300,000. Six hundred workers and 401 retirees were surveyed. The telephone interviewing was conducted by Matthew Greenwald & Associates.