Retirement Financial Advisor and Their Importance –PillarWM

Whatever your net worth and living standards may be, it is inevitable to have concerns about your retirement. The uncertainty of the future can bring stress and affect how you manage your finances today. Fortunately, professionals, such as a retirement financial advisor, are trained specifically for the purpose of planning your retirement. With your future and wealth on the line, you should look for an advisor that best suits your financial needs. Our Ultimate Guide details everything you need to know when searching for a financial advisor to manage your assets worth over 10 million dollars.

STRATEGIES FOR FAMILIES WORTH $5 MILLION TO $500 MILLION

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Clients frequently share with us how the knowledge gained from this book helped provide them tremendous clarity, shattering industry-pitched ideologies, while offering insight and direction in making such important financial decisions.

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A retirement advisor can ease your worries by addressing many of the concerns you have. Wealth managers are experts in this matter as they understand the value of a retirement plan for wealthy individuals. At Pillar Wealth Management, we help clients with 5 million to 500 million dollars in liquid assets create the best possible plan customized to their desired lifestyle. Get in touch with our team for your first meeting.

How to Hire a Retirement Advisor

Your retirement years may seem very far off in the future, but it’s never too soon to start saving for retirement. If you crunch the numbers, you may be overwhelmed by the prospect of accumulating enough money for retirement. An advisor can help. Moreover, even if you have been saving diligently for decades, an advisor could recommend improvements to your strategy.

What Kind of Advisor Should You Hire?

Most financial advisors can prepare retirement plans, but some may specialize in retirement planning, reflected in their certification designations. For example, a retirement management advisor (RMA) has a relevant designation such as CFP and three years of experience, has completed the RMA courses, and pursues 20 hours of ongoing education. An advisor may have a designation of retirement income certified professional (RICP), requiring passing three courses and fulfilling 3 hours of continuing education every two years.

It’s a good idea to hire a CFP, who can build your retirement portfolio, because a CFP is also a fiduciary. You may also want to hire a fee-only advisor, who is not paid commissions and is more likely to be free of conflicts of interest.

If you participate in an employer-sponsored retirement plan, you can get advice from your employer regarding plan choices, fees, and risks.

What Do Retirement Advisors Charge?

Some retirement advisors charge fees based on the value of your retirement accounts, or they may charge a flat fee for a retirement plan.

The advisor may have an account minimum. You may be charged commissions on the products you buy, so it’s a good idea to do some research on the costs of various retirement funds.

It’s always smart to be informed, such as understanding how Social Security works and how retirement accounts are taxed.

What to Expect from a Retirement Advisor

Your advisor will develop a comprehensive understanding of your financial situation to help you build a retirement plan. They’ll want to know about your debts, your income and expenses, at what age you want to retire, and what your lifestyle needs will be. They’ll help you calculate how much money you will need to retire and maintain your lifestyle, based on your life expectancy and your expected Social Security benefits.

Given this data, your advisor can tell you how much you need to invest in your retirement accounts and how much you’ll be able to withdraw once you retire.

How Much Do Retirement Advisors Charge?

A retirement advisor will typically charge a percentage of the assets they manage for you (1% on average). Some will require a minimum investment. They may charge a yearly or monthly fee for financial planning and investment advice. Moreover, they may charge an hourly fee for consultations or a flat fee for a financial plan or an estate plan, varying from $1,000 to $3,000.

How Can I Find a Retirement Advisor?

You may find an advisor by consulting your personal network of family and friends. You can find an advisor online, someone who works at a big investment firm, a bank, or an independent advisory firm.

First, consider your financial situation and define your goals. Whatever your goals, you want an advisor who is competent to help you reach them.

The advisor you choose to work with should have the appropriate certification, such as CFP or CFA (see the FINRA website for the many other designations). Their certification reflects their training, competencies, and code of ethics.

Because you are paying for financial services, you’ll want to know how your advisor is compensated and what fees you’ll be asked to pay.

How Do I Know If I’m Getting Good Advice from My Retirement Advisor?

When you get investment recommendations for your retirement accounts, it is important to know whether your advisor is a fiduciary under Title I of the Employee Retirement Income Security Act (ERISA) and the Internal Revenue Code, which are applicable to retirement accounts. If they are, they cannot receive payments that create conflicts of interest unless they qualify for an exemption issued by the Department of Labor. The department publishes FAQs regarding exemptions on its website.

In addition, you can educate yourself on how retirement accounts work and how to access your Social Security benefits.

Who is the best person to talk to about retirement?

Find an advisor through friends that you trust or a professional you may know, such as a lawyer or accountant; get a few names and interview potential candidates.

What are the three biggest pitfalls to retirement planning?

Some pitfalls are overspending and not saving enough early enough, not having clearly defined goals, and having unrealistic expectations for growth.

What are the biggest retirement mistakes?

It may be a mistake to collect Social Security benefits early, to miscalculate retirement account withdrawals, and to misjudge life expectancy and health care needs.

Is there a difference between a financial advisor and a retirement advisor?

All financial advisors are able to provide retirement advice, whereas a retirement advisor specializes in retirement planning. Any advisor should be up-to-date on issues dealing with retirement.

What are the 7 crucial mistakes of retirement planning?

Not maxing out your accounts, overspending, not waiting for RMDs, borrowing against your retirement, taking early Social Security, not having an advisor, and ignoring tax effects.

What is the disadvantage of retirement planning?

Retirement accounts don’t have the breadth of investment possibilities available in the markets, the fees may be high, and the funds are difficult to access early.

What is one common and costly retirement planning mistake to avoid?

Common mistakes are underestimating future expenses, not saving as much as possible, and not controlling your spending throughout your lifetime.

What is the simplest retirement plan?

The simplest plan is to have two accounts, a 401(k) and an IRA.

What is the safest retirement plan?

The safest retirement plan is to put your funds in low-risk investments with guaranteed growth, such as fixed annuities, savings accounts, CDs, treasury securities, and money market accounts.

What is the 3% rule in retirement?

According to the 3% rule, you should never withdraw more than 3% of your initial portfolio in retirement. This rule is meant to mitigate the risk of running out of money in retirement.

Why is a Retirement Financial Advisor Necessary for High Net Worth Individuals?

If you consider yourself to be independent and organized when it comes to your finances, you might think, “Do I need a financial advisor when I retire?” and “Why retirement need a financial advisor?” The truth is that retirement planning is incredibly complex and can be overwhelming.

Professional advisors are helpful and can warn you against making the wrong decisions. They have enough experience to identify which strategies can work with your unique financial profile and asset allocation.

If you’re a high-earner, you might not have the time or the skill set to make these decisions for yourself. Your wealth might give you a false sense of security that you’re ready for early retirement or to maintain your lifestyle even when you stop earning. A retirement financial advisor can help you understand where exactly you stand in terms of your retirement and advise you on the next course of action if you aren’t ready.

Wealth management firms recognize retirement planning as a priority for high net worth and ultra-high net worth investors, which is why they specialize in it. A wealth manager can help you alter your asset allocation to align your plans and to minimize any potential threats that you are exposed to.Schedule a free consultation with one of our skilled wealth managers to learn how we can help you.

retirement financial advisor

What Does A Retirement Financial Advisor Do?

Create a Financial Plan
Safeguard Your Fortune
Help You Manage Your Taxes
Assist with Transfer of Ownership
Combat Unpredictable Challenges

If you’re wondering, “Why retirement need a financial advisor?” it is worthwhile to understand what a retirement advisor can do for you.

1. Create a Financial Plan

Planning is a crucial part of any financial management. Retirement advisors can help you work out the details of your retirement after analyzing your long-term and short-term goals. Using this insight, they can take steps to adjust your asset allocation or use strategies to maximize your portfolio’s growth. We discuss more on this in our 5 Shifts Guide.

They can help set up and manage your retirement accounts. They can perform numerous tasks, from setting up TFSA accounts to implementing sophisticated strategies that generate outsized compound revenues by using means such as tax deferral and sheltering.

2. Safeguard Your Fortune

A lifetime of wealth-building activities gave you your fortune. However, after retirement, you’ll be relying completely on your savings for your expenses. It can be disheartening to watch all that hard-earned money be used up sooner than imagined when such a scenario could be avoided with planning.

Retirement planners or advisors use long-term strategies that shield you from risks and help you create passive income sources to bring in more money. This helps you have a luxurious lifestyle continuity into your retirement years. To learn more about defending your family from financial ruin, you can read our book, The Art of Protecting Ultra-High Net Worth Portfolios and Estates – Strategies For Families Worth $25 Million To $500 Million.

3. Help You Manage Your Taxes

With a high net worth comes a higher tax bracket. Even after you retire, you might be liable to pay taxes on investments, which will only eat away at your retirement savings faster. Financial advisors can help you design a retirement plan that accounts for these taxes and uses tax-minimizing investment strategies.

4. Assist with Transfer of Ownership

Estate planning is one of the most significant aspects when it comes to your retirement. As a high net worth or ultra-high net worth investor, you might have a business or assets that you wish to transfer to your beneficiaries or inheritors. Transfer taxes can be applied in cases where you don’t have the right transfer plan.

A financial planner can also assist you in coming up with an appropriate business exit strategy to help you leave your company in an amicable manner. They can help you determine whether you would like to remain a stakeholder to continue receiving part of the shares or if you want to remain a partner invested in making decisions relevant to the company.

Lastly, if you don’t have a retirement plan, you could run out of money faster than you expected. Not only will this make the situation more stressful for you, but you won’t have any wealth left to transfer to your children or heirs.

5. Combat Unpredictable Challenges

When it comes to life or money, there are many circumstances that can catch you off guard. It is easier to manage extra expenses or financial hurdles when you have an active income source. All you need is to use the right strategies and have a focused mindset.

However, after you retire, you lose your active income source, and any challenge that arises will directly cost you your savings. Coupled with you no longer having the same level of access to resources, this can leave you in financial ruin.

Retirement advisors can help you prepare for these challenges by advising you on insurance policies and passive income sources. This will shield you from spending your entire retirement savings on unforeseen medical costs, lawsuits, and more.

A recurring and imminent problem for retirees is inflation. Each year the inflation rate increases, and people’s spending power decreases over time. For retired individuals, this can be troublesome as they no longer have the luxury of earning more money. Fortunately, a good retirement advisor can help you prepare for these hurdles and plan your budget to account for inflation.

Our wealth managers are trained in creating a retirement plan that considers all aspects of your financial life.We can help you draft a tax-efficient transfer plan and select a beneficiary appropriate for managing your business or assets as you intended.You can learn more about our wealth management services and retirement planning strategies by contacting our team.

How to Start Planning for Retirement

Identify Your Expenses
Determine Your Retirement Goals
Identify Your Income Sources

Whether you hire a retirement financial advisor or choose to go at it by yourself, you need to know the basics of planning for your retirement. Here are a few steps to help you get started on planning your retirement.

1. Identify Your Expenses

Knowing how much you’re spending now will help you set a standard to meet for your retirement income. Consider any debts, loan payments, mortgages, fees, insurance fees, transport, entertainment costs, and anything else you feel is important.

Once you have an estimate figure in mind, you can work on reducing that number by eradicating unnecessary expenses. Alternatively, if you enlist the help of a skilled retirement planner, you can work out strategies to optimize your portfolio’s performance. This means that you’ll have more room in your budget to enhance your lifestyle and still have future financial security. We talk more about optimizing performance in our Performance Guide – Improving Portfolio Performance: The Shifts Multi-Millionaires Must Make to Achieve Financial Security and Serenity.

2. Determine Your Retirement Goals

Every person has their own opinion of an ideal retirement. Some would prefer relaxing at home and working on their hobbies, while others might want to travel across the world or explore new business ventures.

Undoubtedly, staying physically, mentally, and socially active keeps retirees happier and more content. A retirement plan can help you figure out what you can do with all your free time, allowing you to explore different opportunities. Once you know what you want, you can plan your wealth management accordingly.

3. Identify Your Income Sources

Usually, high net worth and ultra-high net worth investors have multiple income sources. However, are you certain that they will remain secure throughout your retirement?

For most people, there are three primary sources of retirement income, investments, cash accounts, and fixed incomes. Investments include your IRA account, 401(k), bonds, and equities, while your fixed incomes consist of your social security and pension accounts.

The question remains, are they enough to facilitate your plans and fully fund your monthly retirement income for 20 to 30 years? Moreover, if you end up spending all your savings, you won’t have any wealth to transfer to your inheritors. These concerns can be addressed by a professional retirement financial advisor.

What to Keep in Mind When Hiring a Retirement Financial Advisor

As you begin your search for a retirement advisor, you might have questions such as, “How much does a retirement advisor fee cost?” or “How do I select the best retirement advisor?” To help you, we answer these questions and more in our Ultimate Guide.If you have an ultra-high net worth of over 10 million dollars, you can download it for free!

Be sure to check the credentials and certifications of any advisor you consult with. Ask about their fee structure in advance so that you can be prepared for any hidden costs or extra charges. Wealth managers typically charge 1% to 4% of your assets under management. Our firm follows a fee-only structure and discloses all costs and fees beforehand.

When it comes to retirement planning, wealth management firms are a suitable choice for high net worth and ultra-high net worth individuals since they cover an array of different services. These include estate planning, asset management, wealth transfer, and tax management. Using their extensive knowledge, they can create a retirement plan that is more comprehensive and successful than what an ordinary financial advisor can provide.

Retirement Planning Services at Pillar Wealth Management

In most cases, financial planners and wealth managers are the go-to advisors for retirement planning. You need to be sure that you trust whoever you select as your retirement financial advisor. If you’re an ultra-high net worth individual with more than 10 million dollars in liquid assets, you should look for the best possible advice you can get. Our free Ultimate Guide can help you with that.

As one of the best and most experienced wealth management firms, Pillar Wealth Management offers a personalized level of retirement planning services. We help investors with 5 million to 500 million dollars in liquid assets plan out their liquid investments while taking an in-depth look into their various passive income sources, trusts, estates, insurance policies, social security payouts, and healthcare costs.Schedule a meeting with someone from our wealth management team, and we’ll tell you where you stand in terms of your retirement goals.

Authors

Hutch Ashoo

Chris Snyder

To be 100% transparent, we published this page to help filter through the mass influx of prospects, who come to us through our website and referrals, to gain only a handful of the right types of new clients who wish to engage us.

We enjoy working with high net worth and ultra-high net worth investors and families who want what we call financial serenity – the feeling that comes when you know your finances and the lifestyle you desire have been secured for life, and that you don’t have to do any of the work to manage and maintain it because you hired a trusted advisor to take care of everything.

You see, our goal is to only accept 17 new clients this year. Clients who have from $5 million to $500 million in liquid investable assets to entrust us with on a 100% fee basis. No commissions and no products for sale.