Financial Planning

Retirement Planning in 6 Steps (Part One)

Recently, I earned my CRPC designation (Chartered Retirement Planning Certification). Having been in financial planning for my whole career, I did not expect I would learn very much that was new to me. But I did! Do you know that the retirement planning process is not one that comes together by accident? There are six specific steps, to be followed in a specific order for the greatest likelihood of success. While these steps can not anticipate every bend in the road to retirement, it will provide a vital framework as you work to save and accumulate assets in your pre-retirement years. Here are the six steps:

  1. Establish the relationship with your advisor
  2. Share your data with your advisor
  3. Your advisor will analyze your data
  4. Together, you will develop a plan
  5. Together, you will implement the plan
  6. Your advisor will monitor your plan and at least annually, you will meet to review the plan

Let’s start with step one.

Establish a relationship with your advisor.

Study after study finds that money is, for most Americans, their number one worry. That being said, trust is arguably the most important aspect of your relationship with your advisor. Is your advisor a person of integrity? Do they listen to you and hear your concerns and goals? Can you trust them to choose the right investment for you when a comparable product may pay them a higher commission? Do they have the experience needed when markets are disrupted by current events? These are all important questions you should ask yourself.
Once you are confident in your trust for your advisor, you will meet and mutually define the services to be provided. The compensation agreement will be discussed. Both you and your advisor will be clear on each of your responsibilities and leave with an idea of the extent of your engagement. It could be reasoned that the first step in your road to retirement is the most important. A relationship based on mutual trust and respect, is a necessity to the building blocks of a successful retirement plan.

Watch for my next blog, where I’ll discuss the process of sharing your financial information with your advisor and how you can anticipate they will analyze it.


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