Gauge a successful retirement plan with three questionsBlog added by Clif Albino CHFC LUTCF on May 27, 2014
Clif Albino

Clif Albino CHFC LUTCF

New Berlin, WI

Joined: May 13, 2014

My Company

Fred, like so many from his era, could be called a senior, survivor, man of wisdom — even a war hero. This gentlemen worked lots of years and made consistent sacrifices to save. There were precious few options to invest in as he grew up. It wasn’t until later in life that the flood gates of opportunity opened to create and lose large sums of money.

He did not see so well, used a hearing aid and walked with a limp as his wife tried to match his pace. Once they sat down and found a comfortable position, inquiries were made as to who wanted coffee. Fred responded, “That would be nice, if it wasn’t too much trouble.” His wife agreed.

Fred was like so many from his generation: once a proud stallion, now a worn-out workhorse. He talked slowly, respectfully and did not waste words. No one could have reached the heart of the matter faster or more efficiently when he asked three questions about his retirement plan: “How much did I put in? How much is there now? It is still guaranteed?"

After being told what was put in, there was a nod. After being showed the increase, there was an expression of satisfaction. After being reassured of the guarantee, there was obvious ease. He then asked, “How is your family?”

This is where our clients are or will be, if they’ve saved enough, managed money well enough, and live long enough. Better to plan on a long life and be wrong, then wonder where the money is going to come from. The challenge is to make history repeat itself. When reviewing a portfolio, it is easier for the client if there are guarantees for at least the fixed liabilities like mortgages, taxes, insurance, cars, food, utility, etc. Also, it is critical to make allowances for inflation to keep up with the increase in cost of living. This is not the 1990s, when people started to expect 25 percent return per year. It seems more and more people believe that cash is king and difficult to acquire — not to be jeopardized for growth wishes.

Mark Twain’s words from 1835 are more profound and poignant than ever: “I am more concerned with the return of my money, than the return on my money.”
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