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RICP, CFP Financial Plan
#1
I have been a growth investor for the past 25 years.
The pot is now big enough to sustain me or my wife individually or combined according to those sites recommended here and the Fidelity software.
My Fidelity Advisor has simply said, "Don't do anything stupid and you're in great shape."
The issue is that my wife continues to work and generates a very good income while I've been retired the past 7.5 years.
She is now discussing how and when to cut back on her work over the next 2-3 years.
We're both 62 although I'm 1955 vintage vs her 1954 vintage so a bit of impact on SSN.
Since we both have significant IRA's, I don't want MRD's to cause us Medicare penalties.
I'd also like to move some of that IRA into Roth's when our income goes down (she doesn't work).
To engage her in the planning process I looked at enrolling in a class at a local private college, Retirement Planning in Today's Economy.
I've done all that coursework already so I called the sponsor to learn more about where this class leads.
The teacher is a Retirement Income Certified Planner who is also working on his CFP.
Seems to hit the nail on the head, I need to shift from Growth to Income production to replace my wife's income.
Of course, he'll enroll us in his service which can be a fee for service or him managing the accounts.
The fee for service is $2500 to set up the plan which I am responsible to enact and maintain.
Scheduled consults are $150 for questions/review.
Compared to the amount of management fees for this, it seems to be a great deal.
I'd like to hear other opinions about this and should I try to get other people to review his plan?
He is SEC registered with no filings or complaints and I think I've contacted the right person for this task.
There are so many promo's for Financial Planning and Management services that take 1-2% annually, I want to avoid those.
What am I missing?
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#2
My short 0.02$. It depends how much you enjoy/like subjects financial. I think you could learn enough to match this person and not "do anything stupid". It's not like he/she has some bit of magic no one else knows - that is IF you want to dedicate yourself to the subject at hand and pocket the $2500. If NOT --  -- the $2500 could be the best $ you ever spent.
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#3
Blackbeard:
I had previously ran the Fidelity Retirement Calculator and gotten a gold star for being retirement worthy, good thing, I've been retired x 7.5 years.
On the advice of the Adviser team, I went through the Income Strategy Evaluate tool which I again passed.
It gives very simplified advice on which resources to tap but I liked the answer on how much was available to spend.
This tool warns that it won't fulfill the MRD's from the IRA's and the fee for service planner will take those issues into account. I'm inclined to agree that it might be the best $2500 I'll spend this year for financial information.
I'll know more in a week.
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#4
Hi
Are you referring to the fidelity retirement planning tool that gives you a number from 0 to 150 based on your input on expenses etc on this site (anything over 100 is classified as in "good shape") or is there another tool/calculator? I have been trying to get my adviser to give me advice and I haven't been able to get much out of him other than a few fidelity funds to invest in. I was hoping for more advise, i guess since the service is free, you get what you pay for.
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#5
"It depends how much you enjoy/like subjects financial"
That is perhaps the most important part of self-management vs. hiring a Certified Financial Planner at .5% to 1% of Assets Under Management each year. I retired as a CFP, and developing and implementing a full household financial plan is a lot of work. My advice is simple: if you don't like doing this sort of thing, don't do it, but instead, shop for a financial planner holding either the CFP or CPA/PFS designation and negotiate a price. Make sure they do financial planning on all topics of personal finance and not just investing. Topics such as household cash flow, tax management, IRA management, personal auto and house liability insurance (very important), Medicare, Social Security, an Estate Plan (very, very important) and so forth.
 
But if you find yourself drawn to these topics and you're hungry to learn more and have the time (and in retirement making time is easier than when we were working), by all means, self-manage. Just know when you're in over your head and who to go to for professional help. And yes absolutely.....most individuals worst financial enemy is themselves....so as Clint Eastwood said, a man's got to know his limitations.
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#6
That's solid advice. I would just add a couple of points.
 
1.) I can tell you from my experience with people in the business: the 1st, 2nd, & 3rd most important job for such an advisor is: keep the client IN the game. Don’t sell out of fear at the worst possible price. Call it hand-holding if you want...it’s being the needed co-pilot when you need it most.  It’s more than worth the price IF it’s needed. 
 
2.) If you DONT need an advisor to urge you to stay the course—you will save a fortune going the 1 shot fee only route. Make that large 1 time payment. It’s MUCH cheaper. 1% of  assets every year is a phenomenal annuity like payment to the advisor and can be literally devastating to the client LONG term.
 
Don't believe me?
Here's an example from Money Magazine:
 
You and I start out at age 35 with similar $100,000 portfolios.
 
We invest identically the same & receive identically similar results: both generating 6% a year..30 years.
 
You pay a 1% advisory fee. I pay 0.25% in expenses.
 
At age 65, I end up with $103,000 MORE than you.  More than double what we began with...in out-performance.
 
Fee only...at $2k..$2500..whatever..is MUCH cheaper than that.
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#7
My take is it seems like a lot to spend for things that can be managed through free or low cost apps.
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#8
I would suggest you talk to a CFP in your area. Many will do their due diligence and produce your detailed financial plan for free if you agree to have them manage your investments for you. You should be able to find a good CFP for 1.25% - 1.50% of assets fee per year with no commissions to pay. I'm a retired CFP. The CFP coursework is rigorous and difficult to pass. I know a lot of CFPs and all of them have high ethical standards as well.
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#9
(12-04-2018, 04:26 AM)Catbert Wrote: I would suggest you talk to a CFP in your area. Many will do their due diligence and produce your detailed financial plan for free if you agree to have them manage your investments for you. You should be able to find a good CFP for 1.25% - 1.50% of assets fee per year with no commissions to pay. I'm a retired CFP. The CFP coursework is rigorous and difficult to pass. I know a lot of CFPs and all of them have high ethical standards as well.

Nice to see a divergence of opinions here.
Multiple folks that I know do exactly that and it is a CFP that I interviewed today.
I would prefer a fee for service deal and made that clear.
I'm also in no rush and scheduled for follow up in 3 months to review their proposal.
My wife was great, "I really don't care cause I've got a job that covers me"
LOL
 
I laugh at the attempt to lure clients in with golf tourney's and such attempts to "build community".
But it is Marketing 101 in these adventures.
 
I will pay a fee for service but I don't need No Stinking Golf Tournaments
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#10
I was a growth investor for the majority of my working years. As I got closer to retirement (about ten years ago) I gradually sold 90% of my growth investments and focused on dividend growth investments. This is very easy to do, so I would not be inclined to pay someone more than $100 for the "plan." Actually, I wouldn't even pay that. I'd rather give the $2,500 or the $100 to charity.

Last night I was showing one of my nephews, who is 14 years old, what an investment in MMM does just by sitting still. The income grows and I do nothing. I still have some investments that don't pay a dividend, but those are my speculative "fun" investments.

Unless you have no spare time (or lack the interest) to do the work yourself, I would not pay someone to do it. It isn't difficult or complicated. You already seem to know how to manage wealth and investments, so you can do this just as well as the pro.
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