Choosing the right financial advisor to help guide your retirement plans is an important decision. It’s more than just building a portfolio; it’s about building a relationship with a financial professional who listens to your goals and helps you create a path to reach them. The most successful retirement planning involves a collaborative approach that prioritizes your unique situation — not a standard plan that doesn’t fit your specific needs.
Keep reading to find the answer to the common question: “How do I find a financial advisor for retirement?” Learn when to get help specifically for this stage of life, plus four criteria to use when evaluating financial advisors.
Typically, you might find you need help with your financial planning during two life stages. The first is when you’ve reached the need to delegate your finances. Oftentimes, this happens in your 40s or older as your financial situation becomes more complex, and you have begun to accumulate significant financial assets. This stage is the time to start looking for a financial advisor to help you with multiple aspects of your life, with retirement planning being part of that broader financial plan.
You may need financial advice on other issues as well, like planning for your children’s college, evaluating executive compensation options, or handling a windfall of wealth. This stage of life is an ideal time to start building a relationship with a financial advisor you’ll work with throughout the decades to come. Part of the financial planning process will include how you envision your retirement and what you need to do now to prepare for it.
The second is in your 50s and 60s when it’s time to look for a financial advisor to help you strategically plan for retirement in the near future. Maybe you’ve already been working with a financial professional whom you trust. In that case, your annual review may involve shifting some priorities and action items to get ready for your upcoming retirement. But if you’ve been managing your wealth on your own, it’s best to find a financial advisor who can review your current situation and work with you to create a realistic retirement savings plan that aligns with your financial goals. It’s important to delegate your finances at this precarious stage since you have less margin for error, especially if you want to retire on a specific timeline.
While these age ranges and timeframes are typical, it’s never too early to begin working with a financial advisor as time may be the most valuable asset when it comes to retirement planning.
Whatever stage of life you’re in today, the same criteria apply when finding the best financial advisor for retirement. Here are four factors to evaluate as you make your decision.
Not all financial planning firms are structured the same way, so start by finding out who you’ll be working with for your retirement planning. Dowling & Yahnke Wealth Advisors is unique in that you’ll have a financial planning team dedicated to your needs.
At D&Y, we refer to our financial advisors as Lead Advisors; they will be your primary point of contact and will often guide the conversation about what your goals for retirement look like. You also have a Financial Planner on your team who is heavily involved in the retirement planning process. They’ll help you develop a financial plan for your retirement and financial future and conduct in-depth analyses for your plan. Additionally, your Client Service Specialist will be there to help execute and process the strategies and actions that may come out of your retirement planning. Your full team of professionals can be a huge asset in coordinating, customizing, and executing your retirement plan, which accounts for your specific needs and helps to guide you towards your desired retirement.
But your in-house financial planning team is only part of the collaborative process. You may also employ other professional services, like an accountant, tax advisor, or estate planning attorney. When reviewing potential financial advisors for retirement, ask how they collaborate with your other advisors. It’s essential that they all work together to ensure you have an effective and holistic retirement plan.
Another part of the evaluation process is to find out how a potential financial advisor’s planning process works. Do you get to meet with the financial planners and advisors working on your account, or do you fill out a questionnaire and receive an automated retirement savings plan?
At D&Y, we kick off each client relationship with a meeting between you and your financial planning team. You can start with a complimentary introduction meeting before you decide whether or not to work with us. During the initial meeting, you and your Lead Advisor will talk about your financial life and retirement goals. The financial planning team then analyzes your current financial situation and evaluates your progress in achieving your financial goals.
This information helps you decide how to start a retirement plan based on your goals and gives you an idea of your ideal monthly retirement spending. Nailing down these figures is crucial in the years leading up to retirement because it reveals where you may potentially need to catch up to achieve your goals.
When looking at any financial advisor team, find out how much follow-up you can expect after setting up your initial retirement plan. You may want additional touchpoints, or you may prefer less frequent review meetings. Be sure to communicate all your questions and what objectives you’d like to achieve during the retirement planning process rather than solely letting your advisor dictate what this process entails. In other words, remember that you’re the client, and your financial advisor is there to address your specific retirement planning needs — not simply communicate a cookie-cutter analysis!
Be sure to perform your due diligence to ensure the reputation of a potential financial advisor or planner. There are a few ways to do this. First, limit your search to certified professionals. It’s simple to find this information because the advisor or planner will advertise these specific designations: Certified Financial Planner™ (CFP®) or Chartered Financial Analyst (CFA). CFP® professionals must comply with the fiduciary standard whenever they offer you financial advice, in addition to ongoing certification requirements that must be maintained.
As you narrow your list to certified professionals, you can next look at the individual’s background. The CFP Board allows you to search for financial planners and find out if they’ve ever been disciplined or filed for bankruptcy. Both issues are red flags that may prompt you to look elsewhere for the best financial advisor for retirement.
Another helpful resource for finding any history of regulatory discipline is the Investment Adviser Public Disclosure website. You can find any history of regulatory actions and complaints, in addition to other details like their employment history and licensing information. The SEC also has a background check tool that’s worth cross-referencing for other background details, including disciplinary actions. Lastly, BrokerCheck from the Financial Industry Regulatory Authority (FINRA) is a verified fact-checking source which contains information on brokerage firms and individuals.
A final point of evaluation to consider when finding a financial advisor for retirement is how they get paid. There are a number of different methods you may come across. One isn’t necessarily better than the other, but it’s an important detail to find out early in the decision-making process. Here are some common fee structures you’re likely to see.
Evaluate these different payment structures to determine which makes sense for your needs, in addition to which types of service you’d like to receive.
Finding a financial advisor for retirement may seem complicated, but this step-by-step plan can help you to determine the quality of service you deserve from reputable professionals. Retirement planning involves trust and transparency. While much of that is built over time, you’ll start off feeling confident with a financial advisor who has already met some very important criteria.
Looking for retirement planning guidance in San Diego? Contact Dowling & Yahnke Wealth Advisors to learn more about how we can help.