As Population Ages, Merrill Lynch Appoints Gerontology Director

As the first Director of Gerontology at Bank of America (NYSE:BAC) Merrill Lynch, Cyndi Hutchins hopes to rethink how financial advisors approach retirement planning.

Wealth management firms like Merrill Lynch and their clients are facing new challenges as the American population ages and baby boomers begin to put their retirement plans to the test. People are living longer, and thus facing longer-than-expected retirements.

Meanwhile, the nature of retirement planning has changed from the time baby boomers were born, with government and employer benefits becoming less of a factor.

Hutchins, a 28-year wealth management and retirement industry veteran, has been at Merrill Lynch for the last 15 years. Her career took a new turn when she received a Masters degree in Gerontology, aiming to use that knowledge to help a new generation tackle retirement.

“I decided to take it in a different direction,” Hutchins said, adding that her goal is to share her newfound expertise with Merrill Lynch’s advisors and retirement specialists nationwide.

The firm is strengthening its focus on a host of questions related to retirement, and not all of them are entirely financial issues. Hutchins said clients need to consider where they want to live, how they want to spend their leisure time and what they would like to leave behind, both in dollars and in terms of their legacy.

By training advisors to address these issues with individual clients and employees participating in financial benefit plans, Hutchins believes that baby boomers and future generations will be better prepared for life after work.

“We want to help clients not only navigate to retirement but through it as well,” she explained. “It’s important to sit back and determine what clients are looking for. It’s not so much about how much money they have, but what kind of lifestyle they want to have when they retire.”

Retirement planning is largely about preparing for any contingencies, Hutchins stressed. Uncertainty over the future of Social Security, as well as other political battles, serves as another piece of the puzzle.

“It’s just another uncertainty to throw into the mix of ‘what if’ scenarios,” she said, referring to the questions surrounding Washington.

Based on a retirement study from Merrill Lynch, the biggest fear among those eyeing retirement is the threat of a catastrophic health problem. Future retirees must also determine how they will pay for general medical costs and other expenses, Hutchins said. Addressing these questions can make retirement less of a mystery.

That’s where retirement specialists, and Merrill Lynch’s endeavor into gerontology, come into play.

“It’s important to talk to clients about what kind of contingencies they should plan for, like where they will live and what are the costs associated with that,” Hutchins explained.

She added, “It’s one thing to say, ‘These are the life issues you may be facing.’ It’s a whole different conversation to have to attach a number to a specific goal.”

Drilling down the important issues for retirees, as Hutchins put it, has become an increasingly important task for advisors and clients, given the aging U.S. population. According to 2012 data from the U.S. Census Bureau, 25.8% of the total population is over the age of 55, compared to 21.1% a decade earlier. Retirees must be ready to pay for an extended period of retirement, she said.

“Look no further than the unprecedented demographic shift in this country and it’s clear to see that the conversations between advisors and clients need to evolve,” said David Tyrie, head of retirement and personal wealth solutions for Merrill Lynch.

And times have changed since baby boomers began working and thinking about eventual retirement.

“They thought their employers would provide for them,” Hutchins commented. “It’s a much more individual endeavor now than an employer or government one.”

Merrill Lynch will likely expand its efforts to make gerontology a key part of its retirement services. Hutchins said the firm could eventually have a full team of gerontologists to guide an aging population through retirement.

The Bank of America unit has also been working on initiatives dedicated to responding to the aging population. Merrill Lynch co-founded the Global Coalition on Aging, for instance, “to better understand and serve the evolving needs of clients,” the firm said.

“As we move forward, we’d like to put a team in place. This is a starting point for a role in its infancy,” Hutchins said of her appointment.