AKRON, OH / ACCESSWIRE / December 29, 2020 / Retirement is often a future dream and eludes us. Clouded by the complexities of investments, projections, taxes, and more, many Americans seem to be nervous about taking the leap these days. Ben Schrock and the BA Schrock Financial Group team believe it does not have to be as complicated as most people think.
"When you boil it all down, retirement planning is mostly made up of Social Security optimization, income planning, and tax minimization.", says Schrock. "Overall, people found themselves stuck because they didn't understand how to put the big picture together."
After years of helping individuals and families retire, Schrock and his team used their experiences and put together a six-step process that anyone can follow to put together a retirement plan. They call it the "UNLOCK Process."
UNLOCK stands for Understand what you want, Nail down how to get there, Learn about your options, Organize your strategies into a plan, Collaborate on adjustments, and Keep the plan going. This process is designed to guide pre-retirees (and retirees) to a retirement plan that works for them.
Before You Begin, Find Your Team
Many Americans do not want to keep track of the stock market each day, prepare their taxes each year, or keep tabs on political changes that affect their money, and so on. Delegating the financial responsibilities of a team is common. Who that team is can make all the difference.
Consider the following analogy. Would you ask a Toyota salesperson what the best car on the market is? How about the best truck that does XYZ? Probably not, unless you knew you wanted a Toyota. That is not to say Toyota is a good or bad company. It suggests that the salesperson may be compromised in the advice he/she will give.
According to the Gallop report, stockbrokers, bankers, and insurance salespeople all rank toward the bottom-most distrusted professions. Why? Perhaps we assumed they would give us unbiased advice when they were compromised in a sales position.
There is a class of financial professionals out there that gives unbiased advice, but they can be challenging to find. They are called fiduciaries.
To be clear, all financial professionals have a fiduciary responsibility. However, in the opinion of Schrock, very few qualify as complete fiduciaries.
So, how do you find complete fiduciaries? The trick is, ask straightforward questions. For example, make sure they hold a Series 65 license. This license means they cannot accept security commissions like someone who has a Series 7 license.
Another question to ask is how they get paid. There are financial businesses called Registered Investment Advisories or RIAs. They are fee-only. That means no hidden security commissions are going back to the advisor that may compromise his or her advice. Essentially, you know what the advisor is getting paid.
The last question to ask is who they work with. If the advisor worked under Vanguard, what mutual fund do you think you will be offered? That is not to say that Vanguard mutual funds are good or bad… it suggests that they may be compromised when looking at the big picture.
Understand what you want
Now that you've connected with a team of complete fiduciaries, it is time for them to learn about you. Spend an entire meeting with the potential financial team discussing what you want in retirement. Inform them of your retirement goals. Review any taxable situations that may come up. This information sets them and you up for success.
If they cannot articulate what you want in retirement back to you, they are probably not a fit. Your financial team must be in sync with you and your wants. This is your retirement, not theirs.
In the end, if you want to work with a team of financial professionals, make sure you learn who they are and how they operate. Find the right fit for you as they will probably be a relationship you have for the rest of your life. Remember to make sure they are complete fiduciaries.
Nail down how to get there
The next step is to determine where you are and where you want to go. For some, this may be a review of how much you have saved up for retirement, and if you will be able to retire on time. For others, it may be a conversation about their existing retirement and whether or not that can sustain their current lifestyle.
The goal is to be proactive so you can live with the retirement you want. You retire when you hit a certain income amount, not when you hit a certain age.
Learn about your options
The next step is to determine if you agree with their investment philosophy and approach. There is more than one way to build a car (or truck), and you should feel comfortable with their methods, principles, and strategies (the ride).
There seems to be an overwhelming amount of investment options available these days. Countless indexes, a million different mutual funds, and every version of an annuity make for a lot of noise that ends up confusing and frustrating consumers today.
After a complete fiduciary can understand what you want in retirement, they can then start to make recommendations of different investment strategies and products. Just because they are recommending it does not make it right for you.
Consider the options being presented, take them home, and study them. Some of the recommendations may be new to you. That doesn't make them wrong, but it does merit some research before any action is taken.
Organize your strategies into a plan
At this point, you know who you want to work with, they know what you want in retirement, and you have reviewed suitable investment strategies and products. The next step is to organize it all into a plan that you can understand.
There are no perfect investments out there. Your team's job is to bridge the gap between how you are currently invested and how you need to be invested in helping achieve the retirement you want.
It should be expected that your plan addresses when you should file for Social Security, how you will receive income for the rest of your life, and how you can minimize your future tax burdens. Other aspects of the plan to consider are "What will happen when a spouse dies?" "How will the assets pass to the beneficiaries?" and "Is Long-Term Care needed?".
Give your financial team enough time to put it all together and then proceed to the next step, collaboration.
Collaborate on adjustments
The rule of thumb in retirement planning is if you can't explain it yourself or follow it yourself, your plan is too complicated. You don't necessarily need to know how the engine is made, but it is crucial that you can follow along.
At this point in the process, it is customary to make a few adjustments. This is your plan, not theirs. You are the one who will enjoy it or be confused by it. Don't settle for confusion.
When all parties involved agree, the plan looks good, collaborate in funding, and adjusting the plan as needed. Often, an individual or couple will have most of their assets at risk and in a 401k. It is common to roll those funds into an IRA and then place them in different asset classes, according to the agreed-upon plan.
Your financial team should be there to help you move whatever is needed, so your plan is set up correctly.
Now that your plan is in order, pat yourself on the back and pop that bottle of champagne! You have a plan built around what you want, giving yourself financial independence.
Keep the plan going
The best cars still need oil changes or new batteries. The best retirement plans still need tune-ups and adjustments year over year.
Remember the first step when you learned about how to find your financial team? Hopefully, you like them. You'll probably be working with them year over year, making subtle adjustments to your plan as your retirement progresses.
At this point, your job is to enjoy your retirement as you planned. Your financial team's responsibility is to maintain your retirement plan for you. They should be expected to keep up with tax changes, new political policies, and the markets daily.
Unless you want to spend a portion of your day, every day in retirement, managing your finances may make sense to delegate it to a financial team. Who that team is will make a significant difference in your life. Make sure you vet them properly.
Once you have found a team, be wary of cookie-cutter plans. The plan that is put together for you should be custom to you and your retirement dreams. Don't worry about it being perfect out of the gate. Every retirement plan requires subtle adjustments year over year.
Retirement is meant to be a time of rewarding self and relaxing after a lifetime of work. Are you ready to take the next step and U.N.L.O.C.K. in your retirement dreams?
If you don't know where to turn to get started, or you want to talk with Schrock and his team, you can find them at baschrock-fg.com or call them at 330.473.1060. They offer complimentary 30 min calls to discuss your retirement.
Investment advisory services offered through BA Schrock Wealth Management, Inc. (BASWM), a registered investment advisor. Neither the firm nor its agents or representatives may give tax or legal advice. Individuals should consult with a qualified professional for guidance before making any purchasing decisions. Investing involves risk, including the loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.
SOURCE: Clear Retirement News
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