Stats & FactsObserver

FPAJournal.org10 Journal of Financial Planning | May 2014

Observer

“David Blanchett is right: You may not spend as much in retirement as you think. I am a father of four who is paying for all my kids’ college. I have said for years that I could retire on far less than 80 percent of my current income, since 25 percent of my pay goes to taxes, 25 percent to tuition, 25 percent to housing, and 10 percent to retirement. There’s not much left for me, so I have learned to live very lean.”

—Brian Israel, a Money magazine reader responding to the March article

in that magazine “Buildingthe New Retirement,” Money

Great Managers Boost Employee Engagement

Business owners know that when their employees are engaged

at work, they are happier and more productive, and the business is more likely to grow and thrive. It turns out, great managers are the key to truly engaged employees. Researchers at Gallup estimate that at least 70 percent of the variance in employee engagement scores across different business sectors is attribut-able to the manager. And this varia-tion is responsible for the fact that in 2012, only 30 percent of U.S. workers and 13 percent of workers worldwide were engaged at work.

“Worse, over the past 12 years, these low numbers have barely budged, meaning that the vast majority of employees worldwide are failing to develop and contribute at work,” wrote Gallup researchers Randall Beck and Jim Harter in the article, “Why Great Managers Are So Rare,” posted recently in the Gallup Business Journal (businessjournal.gallup.com). What’s concerning is that great managers are rare. According to Gallup research, about 10 percent of people possess the talent to success-fully manage. Twenty percent of people exhibit some characteristics of talent and can be great managers with the proper coaching and development. Gallup researchers also report that companies miss the mark on hiring great managers 82 percent of the time. That may stem from the fact that many companies promote workers to managers because they feel the work-ers deserve it; not necessarily because those workers have the talent to be great managers. In instances when the right manag-ers are hired, and those managers double the rate of engaged employees, those companies achieve an average of 147 percent higher earnings per share than their competition, accord-ing to Gallup.

OBSERVERStats & Facts

FPAJournal.org May 2014 | Journal of Financial Planning 11

STATBANK38...Percentage of entrepreneurs between the ages of 45 and 64 in 2009.

(Ewing Marion Kauffman Foundation)

50…Percentage of entrepreneurs between the ages of 45 and 64 in 2012. (Ewing Marion Kauffman Foundation)

42…Percentage of money held in cash among people in their early- to mid-30s. (UBS)

$58.5 billion…Americans’ expected spending on pets in 2014, up from $34 billion in 2004. (American Pet Products Association)

34…Percentage increase in revenue for the mining, quarrying, and oil and gas extraction sector from 2007 to 2012. (2012 Economic Census

Advance Report, issued March 2014)

37…Percentage of Americans with household income above $100,000 who are living paycheck to paycheck. (Money’s Americans and Their

Money study)

50…Percentage of Americans with household income under $100,000 who are living paycheck to paycheck. (Money’s Americans and Their

Money study)

58…Percentage of workers at companies with 1,000 or more employees who are worried about their future finances.

(Towers Watson)

49…Percentage of Americans who did not trust financial news and advice in 2009.

(Money’s Americans and Their Money study)

22…Percentage of Americans who do not trust financial news and advice in 2014. (Money’s Americans and Their Money study)

2.49%...The gap between the 10-year annualized return (as of Dec. 31, 2013) of the aver-age mutual fund investor (4.81%) and of all mutual funds (7.30%). (Morningstar)

23…Number of states paying $750,000 or more in lifetime retirement benefits through public employee pension plans. (American Enterprise Institute)

6.2…Average number of jobs held by young adults born in the early 1980s from ages 18 to 27.

(Bureau of Labor Statistics)

A lmost half of investors who participated in a recent survey said they want to connect with their financial

adviser through social media, but they can’t find their advisers on social media channels. “With this survey, investors are sending a loud and clear mes-sage to the financial industry: We’re open to talking on social media. We’re likely to listen and engage—if we can find you,” said Jennifer Openshaw, president of social media platform Finect, which conducted the survey of 232 U.S. investors. Key survey findings include:• Emerging affluent investors (with more than

$100,000 to under $1 million in assets) use social media more than mainstream and high net worth investors.

• Female investors are 11.5 percent more likely to connect with their advisers on social media than male investors.

• Sharing the latest investment or personal finance news is the most important social media interaction with advisers, according to investors.

• The number of social media followers an adviser has is the least important feature for investors when choos-ing advisers through social media; an adviser’s ability to answer questions is the most important feature.

Your Clients Want to Connect with You on Social Media

“The key to using these [strategic beta] products successfully is the realization that buzz words, fun titles, fancy machinery, and great marketing do not produce superior returns.”

—Thomas Idzorek, CFA, writing in the April/May issue of Morningstar magazine