When I meet with new clients to discuss their retirement goals, it’s not uncommon for them to be a little confused, or even anxious about their options. This is often regardless of how much money they have saved or the experience that they have investing. There is a general sense of uneasiness when it comes to understanding what steps to take to experience a smooth retirement transition.

What is challenging for me to understand is that many times new clients I speak with have been working with the Edward Jones or Wells Fargo brokers for decades.

You would think this would help with the challenges of retirement planning but in my experience, it seems that many of these type of “financial advisors” are causing confusion rather than providing help and guidance to their clients.

One of the main reasons I think this is happening is due to the mindset of the advisors. The companies they work for train them to help people accumulate money, so everything is focused on “rate of return.” Everybody seems to talk about what their investments have done in the past and what they’re projecting into the future. They are always in a growth mode, trying to help clients grow their money, make more money, and build their wealth.

That may sound good, but people aren’t thinking about building their wealth as they near retirement. They are often thinking about how to use the money they have.

When they are still working, they are putting money into retirement or savings accounts or 401(k)s, and they are living off their earned incomes. While they’re living off their incomes, they’re typically not as concerned about what’s happening with their investment accounts, as they are living life.

As they get closer to retirement, however, they start to connect the dots and realize that when they quit working, they won’t receive paychecks anymore. It’s at this time that the dollars they saved become much more important. They often have a mindset shift away from accumulation to wanting to preserve their money for their future, but often their financial advisor or stockbroker isn’t paying attention to where the client is in life. That leaves the client frustrated and insecure about their options.

I’m finding there are very few financial professionals in practice who are focused on preservation or utilization. They hammer away solely at accumulation. When I meet with my clients, and they have a general sense of anxiety about their future, I find that it’s because no one is addressing their needs or concerns.

A lot of financial professionals try to dissuade clients from using their retirement savings because their mindset is on accumulation. The client is told that if they take from their savings, they have less money earning interest, which lowers their account values and leads to them earning less.

My philosophy for retirement planning is that the whole purpose of saving money is to be able to access and use it. It makes no sense to me to accumulate wealth over a lifetime then feel scared to use it. If that is the case, then what are we doing?

The epiphany that I had several years ago is that people don’t save money just to have money. They save money to use money. So, many of the designs and strategies with which we help clients are utilization strategies.

If you feel you need a second opinion about your retirement plan or simply have a question, let me know. I get questions from our community about this all the time and want to encourage you to begin to focus on the reasons why you are saving money and not just listening to the typical status-quo mantra that revolves around “rate of return” and putting your money at risk.

The whole point of retirement planning is building a plan so you can live your life to the fullest. If you have goals and dreams, whether that’s traveling, building a second home, paying for your kids’ college education, or starting a new business, put a plan in place to make those dreams happen!

To Your Success!