Many investment advisory firms offer retirement planning services. Registered investment advisers (RIAs) are held to a fiduciary standard and must always act in their client’s best interest. This makes them more trustworthy than other advisors, such as hedge funds and robo-advisors.
Creating a Financial Plan
Financial planning can make these goals more manageable, whether saving for retirement, buying a home, or paying off debt. An advisor can help you determine how much you should save, where to invest, and if meeting your objectives for Boeing retirement plans is realistic.
An advisor should also consider factors such as your income, existing investments, and tolerance for investment risk. The plan is a guide that can be tweaked as you go through life changes, such as marriage, divorce, starting a family, or approaching retirement. Depending on their firm structure, advisers may receive compensation in the form of fees based on the amount of money invested with them or as a percentage of assets under management.
Identifying Investment Goals
It’s essential to identify financial goals, both short- and long-term. This process will help you determine how much money you need to save and the investments you should invest to meet your goals. Generally speaking, investment goals include both growth and preservation of capital.
For example, a goal could be to grow your money to an amount that will allow you to retire comfortably. However, your time horizon may dictate that there are more important objectives than this. Instead, you might be more interested in protecting your investment assets from inflation.
A financial advisor can help you identify these goals and explore strategies. They can also help you establish a budget and create savings and investment accounts to facilitate their completion. This will help you track your progress and make necessary adjustments if the plan isn’t working. For instance, moving your money from high-risk investment vehicles into more conservative assets may be appropriate if you save for retirement.
Creating a Budget
A financial planner will help you create a budget for your expenses, savings, and investment goals. They may also assist you in determining how much money you can expect to receive from sources such as Social Security, pensions, and personal savings. They can also run simulations of best- and worst-case retirement scenarios, including the possibility that you will outlive your savings.
Your advisor will choose investments to suit your financial profile, including goals, investing preferences, and risk tolerance. They will also periodically review your portfolio and rebalance it by buying and selling assets to keep it aligned with your desired level of risk.
Dual-registered advisers (RIAs and broker-dealers) are likelier than independent RIAs to offer insurance products or other services as part of their investment advisory business, leading to additional fees that can chip away at your nest egg.
Investing
During retirement planning, investment advisory firms can help you choose the best investments for your goals. They can also assist you in creating a plan that will make it easier to manage your expenses. This can include setting aside an emergency savings account and determining how much you will need in retirement to cover your costs.
Most investment advisers charge fees based on the percentage of assets managed, and these fees tend to increase with AUM. Some advisers charge hourly and performance-based fees, typically limited to high-net-worth individuals.
In addition, advisers may have affiliations with broker-dealers, and these relationships can create additional conflicts of interest. These additional conflicts can result in more fees, which can chip away unnecessarily at investors’ nest eggs. This is especially true for dual-registrants, who can switch between fiduciary and brokerage obligations, confusing their clients.
