If you live in Phoenix or Scottsdale Arizona or are planning to move there in retirement, you may be looking for a local retirement planner. With so many options available, how do you make sure you find the best one? Here are some tips:
Look for a comprehensive planner
Many people, when they look for a retirement planner, are thinking just in terms of retirement. They want someone who can provide advice about retirement savings and what to invest in. They may want someone to manage their multiple income streams in retirement.
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But in fact, even if your focus is retirement planning, the best strategy is to look for a comprehensive financial planner.
Why? Because retirement planning encompasses nearly every aspect of your financial life. Yes, the focus may be managing retirement income like individual retirement accounts (IRAs) and 401(k)s. But your savings and overall management of these can be very determined by your overall cash flow and spending plan – elements a comprehensive financial planner needs to review.
A retirement planner also needs to know your goals. Do you want to travel in retirement? Start a business? Have a second home by the beach or in the mountains?
Your retirement plan also needs to look at other key areas of your life, including how to minimize risk. Do you have adequate life insurance for spouses, children, and other relevant family members, for instance? Are your possessions and housing properly insured? What’s your tax situation? Can it be improved? Yes, Arizona is a relatively low tax state, but a good financial planner will know your individual tax environment thoroughly and provide appropriate advice.
If you have non-retirement investments, a planner needs to factor these into your overall retirement plan. What assets do you have? Do you plan to leave them to individual family members? Is there an estate plan to do so? If not, you can save yourself and your family a lot of heartache by having one. A comprehensive financial planner can advise you about developing an estate plan.
Know the differences between standards
When you’re shopping for a retirement planner, it’s important to know the difference between financial advisors and their standards. Some retirement planners are fiduciaries, which means they must follow a fiduciary standard. Others are not.
Following a fiduciary standard means that the advisors are mandated to put their clients’ interests above their own. They must provide advice that is sound and accurate and follow a high standard of care and trust. A fiduciary must disclose any conflict of interest when they discuss investments with you, for example. Fiduciaries are regulated by the U.S. Securities and Exchange Commission.
Many retirement planners who are not fiduciaries must follow a suitability standard, overseen by the Financial Industry Regulatory Authority. Any investments or products they advise for you needs to be suitable for your goals, but these advisors do not need to place your interests above their own.
The difference is perhaps most clearly seen in an example. If you choose a retirement planner whose title is retirement wealth adviser, they may be brokers who can buy and sell stocks for your retirement and other accounts. If they know your goal is steady income in retirement, they should advise the purchase of dividend stocks and bonds, rather than, say, aggressive growth stocks, following the suitability standard.
But in purchasing dividend stocks for your retirement account, they could choose stocks that have a more beneficial impact on their own commissions. A fiduciary, on the other hand, would have to choose the commission structure most beneficial to you rather than themselves, because they need to place your interests above their own.
It’s a good idea to ask potential retirement planners if they are fiduciaries.
Know how to assess qualifications
All the possible titles you may see when searching for a retirement planner in Phoenix – retirement planner, retirement wealth adviser, retirement specialist, financial specialist – do not necessarily indicate a comprehensive level of knowledge or fiduciary status. How do you make sure the planners who find do have comprehensive knowledge? How do you find out the standards they follow?
One method is to look for a certified financial planner (CFP®) designation. To become a CFP®, advisors have to complete the Certified Financial Planner Board of Standards requirements. These requirements include completing courses, passing the CFP® Board’s exam, working several years in the financial planning experience and upholding the CFP® Board’s standards of conduct.
The CFP® exam covers retirement planning, financial planning principles, investments, education planning (for college savings), risk management, insurance, tax planning, estate planning, and professional conduct and regulations.
ARQ Wealth Advisors is a team of experts who are passionate about helping investors achieve their financial goals. The team includes Certified Financial Planner™ professionals (CFP®s), Chartered Financial Analysts® (CFA), Retirement Income Certified Professionals ® (RICP), and Accredited Investment Fiduciaries ® (AIF).
Choose a retirement planner based in or near Phoenix
There are a host of options when choosing retirement planners. Once you start to look, you may find many online planners and advisors who are not necessarily local to the Phoenix area or even Arizona.
Many important retirement considerations, such as taxes and costs, vary significantly depending on where you live, so you may want to consider using a local financial advisor.
You need someone who can advise you about the Arizona tax environment, for example, not simply give general advice. A local planner will also likely know of any planned changes to taxes and can advise you accordingly.
A local retirement planner is also likely to be accurate on costs. Phoenix’s retirement costs are lower than those of many places in the nation. Real estate costs, for example, can be very affordable. But other costs, such as utilities and medical costs, can run higher than the national average. A planner familiar with costs in Phoenix will give you a more accurate sense of how far your cash flow will go in retirement.
Interview the candidates
It’s a good idea to interview the local retirement planners you find in Phoenix. You want to assess their experience and practice. More importantly, perhaps, you want to assess how they will be addressing your specific financial needs.
- How long have you been practicing?
- Tell me about your ideal client
- How often do you communicate with clients?
- Explain x concept to me (asking a planner to open-endedly explain a retirement concept, such as “what do you think about annuities?” or “how much money can I withdraw each year of retirement without running out?” is a good way to find out how they communicate with you
- How are you paid?
At ARQ Wealth Advisors:
- You’ll receive highly personalized service and attention to your goals
- You will receive advice from our credentialed, seasoned experts
- You’ll feel supported and coached to stay on track with your plan
- We’ll be available for extra financial advice (such as questions on refinancing your mortgage, for example)
- We’ll keep in touch with you often
- We’ll return your calls and emails quickly
Contact us today for a free no-obligation financial review.