Help your clients ease into the retirement cycleArticle added by Briggs Matsko on March 22, 2013
Briggs Matsko

Briggs Matsko

Sacramento, CA

Joined: August 21, 2010

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The retirement conversation can be daunting both for the advisor and the client. However, it’s a necessary discussion that my practice approaches using a unique strategy we call the “EASE” process. We approach retirement planning in a manner that helps make our clients feel secure rather than overwhelmed in their futures. In separate appointments, we address each of the following phases: envision, analyze, solutions and evaluate.

Envision: Simply put, it’s how we engage a client to think of their future. For our clients who are nearing retirement, our conversation in the first meeting begins with what they see themselves doing in retirement and when that will begin. We then ask them how they plan to categorize their expenses and link them to their income sources and assets. Most people have abstract ideas about this, as opposed to a specific plan or process. So, it’s a combination of a life planning discussion linked with the economic event of retirement planning.

When we delve into the life planning topic, we first have the client share when they plan to retire. The conversation is very informal in the beginning. What are the client’s goals for their retirement? We’ve gotten a variety of responses, anywhere from doing nothing but sitting by their pool for the first year to trekking the Himalayas to staying home to care for their grandchildren or golfing everyday.

It’s a lighthearted place to start, free of any product discussions. It gives us the opportunity to understand the client, build trust and, as a bonus, they don’t feel like they’re being sold. In fact, we explain that there is no obligation to buy anything from us, as most pay a fee for the service. If there is a need that is uncovered and the solution requires a product, the client is free to implement with whomever they please. Ultimately, however, 75 percent of clients who go through the process with us also implement product solutions through us. We’ve done the objective work first, which is of great value to the client. Learning more about the lives of our clients is the main objective during this phase of the process. In the words of the great mentor Mitch Anthony, who has had a profound impact on the way I conduct this process, “Find out where their heart is, and their head will follow.”

Analyze: Out of life planning comes the economic discussion and subsequently, the analysis of their data. Once the client has communicated their vision of retirement, we transition to explaining and solving the four major risks in retirement: expense risk, inflation risk, longevity risk and investment risk. We use a very robust proprietary software program to create an interactive experience that allows us to build multiple what-if scenarios, customized to the client’s situation. By using graphics and images to convey complex concepts, we engage the client at a higher level that is very personalized.
Instead of having multiple appointments, we gain a great deal of efficiency through the use of our interactive software. Clients can see what their picture looks like and adjust it accordingly. This helps both of us create and manage expectations when it comes to making recommendations and offering both product and non-product solutions. Once we agree on the plan that is most suitable, we print off a copy so the client can have it to refer to during the year and compare it to reality in their next evaluation appointment. The plan includes rate of return expectations, a budget, assumptions about inflation and longevity, as well as a host of other factors that are individualized to the client, such as risk management.

Solutions: Once we’ve broken down the facts and figures of a client’s financial picture, we are able to shift into determining solutions to help them achieve the retirement they’ve imagined. We discuss their current investments, make a determination of portfolio construction and create an investment policy statement going forward. However, all solutions are not necessarily product-specific. For example, we sometimes agree that clients should work a bit longer or adjust spending expectations in retirement.

Evaluate: The EASE process is illustrated in a circle because we don’t believe retirement is a one-time event. Rather, it is an ongoing plan that must be evaluated on a routine basis. From start to finish, the process spans the cycle of one year, and then we revisit the life planning stage again in the second year. It’s surprising how a client’s vision of their retirement can change. For example, we’ve had clients shift gears so dramatically that they start a new business or get involved in politics.

Consequently, the EASE process is a never-ending circle that keeps clients (and planners) on track in retirement while taking into consideration and adjusting for unforeseen changes along the way.

Defining and following the EASE process enables us to be calculated in guiding the construction of our clients’ retirement plans. Each meeting has a designated goal, and clients take comfort in knowing we will revisit their visions from year to year. What we find is that people’s ideas about their retirement change, so we’re able to better help them adjust for those changes from the economic and life planning perspective. The initial conversation in the first meeting is the framework for the rest of the year. And the EASE process is our formula.
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