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June 15, 2018
Here's the toughest question I ask my clients
In order to accomplish a goal, most of the time it is best to work backwards. In other words, make the goal very specific and determine the steps you have to start taking now in order to reach your future goal. Makes sense, right?
But what if you really don't know what your specific goal is? I mean, you may have a conceptual idea in your head of what your goal is, but it isn't an exact number, time, or place. That's an obstacle because it makes all of your planning, from beginning to end, overly flexible and involves faulty assumptions; guess work becomes the order of the day. Measuring progress toward your goal, under these circumstances, becomes more of a measure about "how you feel" at that particular moment, which we both know is meaningless without accurate data to back it up.
So, here it is - the toughest question I ask my new clients - because most of the time, they only have a vague idea, not an exact number, which makes today's financial recommendations somewhat (if not overly) reliant on guess work when it comes to planning the steps for accomplishment of said future goal. Here goes:
"At what age do you want to retire?"
At face value, it's a simple question. Now, try to answer it with an exact age. You could see the variables swirling around in your mind; how much money do I have saved up now, how much more will I have to add to my retirement plan, when should I claim social security, where will I live, what is my personal vision of retirement, how much will my healthcare costs be, do I even want to become fully retired? Etc, etc. These are all highly personal questions, which, of course, puts the "personal" in personal finance.
From my perspective, I believe this retirement age question should come before the question "how much are your investment accounts worth". That is the wrong starting point. It implies the wrong motivation on behalf of the advisor - that he or she is only interested in what's in it for them in terms of the assets under management fee.
My clients run the gamut; from those who could easily afford to retire right now to those who are just starting out in their adult life. Some still work because it is their choice and some still work because they are insecure (rightly so or not) about how long their money will last during retirement. And of course, many are currently enjoying their retirement as I write this - and if you're at Shinnecock Hills enjoying the U.S. Open, I look forward to seeing your pics on Facebook, lol.
Even if you can't pick the exact age that you want to retire during our discovery process, it is still important to pick an age out of your conceptual thoughts of it, because it gives us the goal in which to work backwards from. We can always make adjustments as we move along, but better to understand the possible steps and outcomes you face sooner rather than later.
One all too common way to save and invest for retirement that I see with prospective clients is to just save and invest as much as possible and see how far that'll get them when they reach their 60's. I'm here to tell you that you could do better than that.
Making judgment calls like working longer, seeing how much you could spend on travel during retirement, learn how adding a little more to your child's 529 plan could possibly add up to over the next 10 years, and realizing as soon as possible that your needs, wants, and wishes in retirement may need to be re-prioritized, are just some of the things that could help make you smarter about your finances - and raise your potential for a successful retirement.
Maybe you need to raise your investment risk tolerance? Maybe you need to consider claiming Social Security (you get an 8% raise for each year you wait. I also do a breakeven analysis for clients to help them pick the claiming age that is appropriate for them). Maybe you're a millennial or Gen Z'er and you think social security won't be around for you?
So many variables, so many combinations.
As a financial planner and investment advisor:
- I take into account the variables that apply to you when creating your personalized financial plan
- I anticipate your life events and bring you timely financial advice
- I Manage your assets according to your risk tolerance and financial goals
If you're looking for a better way to save, invest, and plan for your retirement, click on the "Let's Talk" picture below to schedule a 15 minute phone call with me.
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Thank you for taking the time to read this!
Mitch
I opened ClientFirst Strategy, Inc. because I believe that the only way to help my clients potentially achieve their goals is by offering unbiased advice & investment management expertise. To my clients, thank you for your continued vote of confidence. If you are not a client but would like to explore the possibility of becoming one, I invite you to call me directly, visit my website, join my email list, and/or connect with me on social media.
All the views expressed in this report/commentary accurately reflect our personal views about any and all of the subject securities or issuers and no part of our compensation was, is, or will be, directly or indirectly related to the specific recommendations or views we have expressed in this report. This material is not intended as an offer or solicitation for the purchase of sale of any security or other financial instrument. Securities, financial instruments, or strategies mentioned herein may not be suitable for all investors. Any opinions expressed herein are given in good faith, are subject to change without notice, and are only correct as of the stated date of their issue. Prices, values, or income from securities or investments mentioned in this report may fall against your interests, and you may get back less than the amount you invested. The information contained in this report does not constitute advice on the tax consequences of making any particular investment decision. You should consult with your tax adviser regarding your specific situation. Diversification is a method of managing risk and doesn't protect against loss in a down market.
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| Mitchell O. Goldberg, AAMS, President | Investment Professional OSJ Manager ClientFirst Strategy, Inc. 290 Broadhollow Road, Suite 200 E, Melville, NY 11747 (D) 631-920-6622 (F) 631-920-6624 (C) 516-818-0338 mgoldberg@clientfirststrategy.com | www.clientfirststrategy.com MissionStatement: To financially empower our clients so that they can achieve their most important goals and to confidently plan for the future that they envision.
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Asset Management:
~Asset Allocation Strategies
~Unbiased advice
~Strict mutual fund screening
~Alternative investments
~Retirement plans
~401(k) rollovers
~College savings plans
~Donor Advised Fund/ Charitable Giving
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Insurance:
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-Group Benefits:
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Individual Client Services:
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Securities & Investment Advisory Services Offered through NEXT Financial Group, Inc., member FINRA/SIPC. ClientFirst Strategy, Inc. is not an affiliate of NEXT Financial Group, Inc. |
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