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Retirement Planning > Saving for Retirement

Jamie Hopkins: Why Your Clients Are Stressed, and What to Do About It

By John Manganaro

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What You Need to Know

  • Survey data from Guardian shows workers’ sense of well-being has fallen to its lowest level in 12 years after peaking in 2022.
  • Advisors risk falling out of touch with their clients if they focus too much on economic data and not enough on client perceptions, especially about retirement.
  • Planning expert Jamie Hopkins urges advisors to have frank conversations with clients and to embrace a change-management mindset.

Though seasoned financial professionals may be paying more attention to the growing indications that an elusive “soft landing” may indeed be possible for the U.S. economy amid the Federal Reserve’s fight against inflation, the reality is that the average working American is deeply stressed about both their personal finances and the state of the U.S. and global economies.

In fact, as noted in a new video posted to the social media platform X by the financial planning expert Jamie Hopkins, director of private wealth management at Bryn Mawr Trust, self-reported well-being has dropped to its lowest level in 12 years, with most Americans citing personal finance-related stressors as the primary contributor to the decline.

In the video, Hopkins points to this and a variety of other findings from Guardian’s recently published “Mind, Body, and Wallet” report to warn advisors about the growing potential for falling out of touch with their clients if they fail to look beyond the macroeconomic data and consider clients’ lived experiences.

It may be true that markets have rebounded strongly from 2022’s lows and that today’s retirement-focused investors can build safer and higher-yielding portfolios than at any point in more than two decades. However, that doesn’t negate the fact that people are worried about inflation, political divisions, geopolitical tensions and much more.

As the Guardian report notes, these mixed economic and emotional concerns are mounting just when many workers are being asked to return to the office and a traditional work schedule.

“The shift back to in-person has far-reaching effects, many of them stressful,” the report warns. “Families’ budgets are stretched by commuting costs, childcare arrangements are being upended yet again, and the ability to easily pick up a sick kid from school or take a parent to a routine check-up during the day has diminished.”

Perhaps most striking, the report indicates not only that Americans are rating their mental, physical and financial wellness at record lows, but they are doing so following a notable peak in self-reported well-being in 2022.

Causes for Concern

“[Guardian] found that financial stress is at the highest for Americans that it’s ever been [in the 12 year course of the study], and that is really concerning,” Hopkins says.

The finding is a surprise, he says, because “there are a lot of good things going on in this country.”

“There’s a lot of good things with employment going on,” Hopkins says. “But people are stressed and that is real. The perception of what is going on — people are feeling it.”

As Hopkins notes, the top three stressors cited in the report are “money and finances,” “the economy and inflation,” and “debt.”

“Even if inflation is getting under control, people are still feeling the impacts of it,” Hopkins says. “In the debt world, you saw student loan repayment relief [changing], and people missing those payments. You’ve seen the total amount of credit card debt hit an all-time high.”

One silver lining, Hopkins says, is that Americans’ credit card debt is not at an all-time high when compared with the total amount of assets held in Americans’ wallets. Still, people are relying more on borrowing, and the higher prices of homes and all manner of goods and services is straining budgets.

“[The survey shows] 51% of workers are worried their retirement savings won’t last their lifetime,” Hopkins adds. “Forty-eight percent of people are worried about not having guaranteed income sources in retirement. [That reflects] concerns about the funded status of Social Security, pensions and other products and services out there.”

A Change Management Perspective

According to Hopkins, it is important for advisors to understand the potential disconnection between some of the big macroeconomic numbers reported in the financial media and the actual perceptions people are experiencing.

As the Guardian report emphasizes, it is well worth advisors’ time to check in with their clients to gauge their levels of optimism and pessimism. Especially when it comes to retirement, perceptions can deeply affect peoples’ choices and their ability to enjoy (or not) their hard-earned wealth.

“Look, for people, as they retire, that’s the end of their work checks coming in. It’s the end of liquidity events,” Hopkins warns. “We aren’t going to get another shot at that. So, again, respecting [clients’] concerns is super important, and it’s really meaningful to have serious discussion and conversations around this.”

Hopkins further notes that, as people prepare for and transition into retirement, they move “from the current work state, to a retiring state, to a retired state.”

“The reality is that we are moving through big changes, going from a current known state to an unknown change state — to hopefully a state that looks very different, right?” Hopkins says. “It’s different expenditures, a different life, different experiences that we haven’t lived through before.”

Given the dynamic nature of the effort, Hopkins concludes, one powerful way to think about the retirement income planning challenge is “treating it like a change-management process, like a change management product.”

“Understand that we go through unknown areas and we are going to have to adjust to this over time,” Hopkins says. “How do we deal with the stress points? Treat it like it is true change.”

Pictured: Jamie Hopkins 

John Manganaro

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