4 Questions Clients Ask a Financial Planner About Retirement Fears - Business Insider
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Financial planner Ryan Ashley. Photo courtesy of Ryan Ashley
- A financial planner says clients worry about how the news cycle will affect retirement plans.
- He's also constantly asked how to make sure money will last through a whole lifetime.
- Questions about estate planning are also common.
- Read more Personal Finance Insider coverage »
Financial planners get a lot of questions about retirement — both from retirees and people who are still planning their exit from the working world.
Financial planner Ryan Ashley of MAI Capital Management says there are four questions he's constantly answering about retirement.
1. How will the news affect my retirement and investing plans?
Ashley says many of the discussions around retirement often start with questions about what's going on in the news cycle, and how that could impact retirement planning.
"You'll get questions about political elections, or higher taxes, or investment questions, or interest rates. Whatever the theme in the financial news has been is usually a starting point for a lot of questions," Ashley said.
While it's a common concern, it's likely that the news shouldn't change things. If you have a solid financial plan, sticking to it is generally the best course of action, regardless of the headlines, he said.
"Have a proactive game plan in place so that when the topic du jour changes, when something happens unexpectedly in the world or in the market, you have the solace of knowing that your plan is OK," he said.
Financial plans are typically long-term, especially in the case of retirement. That means the execution takes decades. If you've worked hard to make a financial plan, sticking with your plan for saving, investing, and retiring is generally the best move. The ups and downs of the market even out over time, no matter what's going on in the news.
2. How do I create a stream of income that's going to last for the rest of my life?
Ashley gets a lot of questions from clients about how to live off their money in retirement, how to make money grow, how to be tax-efficient, and how to make money last. As a financial planner, he says it's about having assets managed correctly.
First, he asks them about their current financial plan: their previous experience, their current investment strategy, and how much clients have planned already themselves.
"I want to hear what their game plan is for turning assets that they've worked really hard to save for decades into a stream of income," Ashley said. "Have they thought about that? Do they understand the most tax-efficient ways to take income in retirement?"
Then, it's about tailoring the financial plan to make sure the money will last. Having your accounts invested correctly for your timeline, as well as making sure that you've saved enough to afford the lifestyle you anticipate living in retirement, are two big factors in this process.
3. How do I take care of my family's finances if I'm unable to make decisions?
No one wants to think about a future in which they're unable to make the financial decisions that affect their family, but that day will come for many of us.
Unfortunately, Ashley says it's something he sees people lacking in their financial plan.
Talking about investing strategies might be more fun, but making sure that your money is taken care of if you're incapacitated is equally important. Answering this question usually involves creating or updating estate planning documents, like a living will and power of attorney. A living will outlines instructions for medical treatment if you're not able to make decisions for yourself, and a power of attorney can designate someone else to make financial and medical decisions on your behalf if you're unable.
4. How do I transfer wealth to my spouse and children and organizations that are important to me?
Estate planning is an important conversation to have, and a common topic people have questions about, Ashley said.
And while it's not the easiest conversation, it's critical. "Daydream about what kind of financial legacy you'd like to leave to your children, to your favorite charities," Ashley said. "Then, be sure that we proactively have those estate planning documents in place so that those wishes are efficiently and accurately carried out."
To start, you'll want to make sure you have a last will and testament, and that the correct beneficiaries are designated on any investment and insurance accounts (remember, you can update them if your circumstances change).
Disclosure: This post is brought to you by the Personal Finance Insider team. We occasionally highlight financial products and services that can help you make smarter decisions with your money. We do not give investment advice or encourage you to adopt a certain investment strategy. What you decide to do with your money is up to you. If you take action based on one of our recommendations, we get a small share of the revenue from our commerce partners. This does not influence whether we feature a financial product or service. We operate independently from our advertising sales team.
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