You’re just going through a stage.
Yes, you are, and we’re going to
make it the best it can be.
How We Do What We Do
Most people do not know how to navigate through the different financial life stages let alone where they are – or should be – in the process.
As your wealth navigator, we work with you to discover where you fit into the financial world and then tailor our services for each of your life stage.
These are the stages and the steps you need to consider.
EARLY CAREER
Even as you’re getting your feet wet in your career, you need to look on golden ponds – yes, toward retirement. Sounds a bit extreme, but the key to a great life is envisioning and planning for it. We help you set yourself up for life. Here are some steps to get started:
Develop an investment plan as soon as you land a full-time job.
Take full advantage of your employer match in a 401(k), 403(b) or a subsidized stock savings program.
Compare retirement account options – a Roth or traditional IRA – to get the best tax advantage.
Establish your investments in a proper mix of stocks and bonds, rebalancing when needed.
Learn your risk tolerance so you can commit to an asset allocation that works for you.
Navigate your college loans and saving for your first home.
MID-LIFE ACCUMULATOR
All you did was blink and now you’re a mid-life accumulator. As the years race by, retirement is no longer a distant dream. You must address accumulating and maintaining wealth, and do it correctly.
Estimate the retirement income needed from your investments:
Estimate your annual expenses in retirement
List known sources of pension income, including social security
Figure out your current wealth and plan your future savings
Calculate your required rate of return
Find the optimal investment mix/asset allocation
Ensure the asset allocation does not exceed your risk tolerance
Create a plan to grow your wealth and follow it. Do not forget about your plan and why you set it up!
Begin estate planning.
RETIREMENT TRANSITION
Sometime during our late 50s or early 60s, most of us enter the retirement transition stage. This period begins when we have about five years of full-time work left before retiring of transitioning to part-time work.
When people enter this stage, their first question is usually, “Do I have enough money to retire?” To find the answer, we need to revisit and re-estimate the retirement income you need (the list in the Mid-life Accumulator stage). From there, Liberty Capital helps you navigate special circumstances during this transition, including:
Rollover of retirement plan to an IRA
Estate planning document review
Safe withdrawal rates/plans
Tax-optimization when taking money from an investment account
Special considerations: if you retire before age 59 ½, if you retire before age 65, Roth conversions
Social security, Medicare, supplemental insurance
Reducing investment in your retirement accounts if needed
One last thing – Enjoying retirement. You deserve it!
GOLDEN YEARS
During this stage, there are two critical issues you should address. First, make sure your financial paperwork is in order and up to date, including correct titles on accounts and correct beneficiaries. Second, appoint someone to act as a fiduciary on your accounts in the event you become incapacitated.
Other items to consider:
Estate planning
Philanthropy
Long-term care considerations
Wealth transfer: gifting and/or 529s
Why Work with an Advisor
If navigating your investments through the life stages is something you are not interested in doing, you can hire a professional investment advisor. They exist to help you formulate an investment plan, implement it, monitor the results and modify the investment portfolio when needed.
Good advisors will not only ensure that your account in managed according to your specifications but also talk with your children and educate them about proper investment principles. There is no guarantee that an advisor will achieve superior investment returns, but that is only one of the many considerations in the relationship.
Here is a partial list of the benefits of working with an investment advisor.
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Helps tailor an investment plan.
Many people need help formulating an investment plan and developing the correct asset allocation for their needs. They may already have a general idea of where they want to go financially, but not the tools or the expertise to put a complete plan together. An investment advisor will help clients understand how to meet their needs and help them implement and manage a complete investment plan.
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Provides consistency of strategy.
On average, people switch investment strategies about every three years (as measured by Investment Company Institute mutual fund turnover statistics). Advisors are (or should be) more consistent. This consistency of management style should achieve higher lifetime returns.
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Serves as a circuit breaker.
When an investor wakes up in the middle of the night because of a nightmare about the markets collapsing, an advisor is a call away to act as a psychologist. This interaction usually means calming down the investor and talking him or her out of making an emotional investment decision.
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Is on duty 24/7/365.
Believe it or not, there will come a time in your life when you just do not want to deal with this investment stuff anymore or can’t deal with it for health reasons. Advisors are there to do the investment chores for you, day in and day out.
