CFP Board proposes tightening fiduciary requirements: ‘Huge step’ or ‘double standard’?

The CFP Board has proposed sweeping changes to its ethics rules and standards of conduct, seen by some experts as a revolutionary tightening of its fiduciary requirements. But some fret the board is bowing to major firms in a bid to grow its base.

The proposal is “a huge step in the right direction,” says former CFP Board Chairwoman Patti Houlihan, whose thinking contrasts sharply with that of industry consultant and CFP Timothy Welsh. “This is a double standard they are promoting here,” he says.

The differing views represent the opposite sides along the spectrum of reactions from CFPs who have watched the board’s evolving commitment toward client-first service.

‘A BOLD MOVE’

The board released a 17-page proposal that includes a new, combined ethics code and revised standards of conduct. The rewrite is the product of 10 town hall meetings over the past year; the board will seek further comment at eight more meetings over the next two months.

Kevin Keller, CEO of the CFP Board

Kevin Keller, CEO of the CFP Board

“This is a bold move for us, expanding the definition of financial advice,” Kevin Keller said during an interview with Financial Planning’s editors in New York on Monday.

One rule could be read as a line in the sand against the wirehouses: A CFP “must correct” any misrepresentations by their employers to clients regarding their compensation, the draft says.

“This is a doozy,” says CFP Dan Moisand of Moisand Fitzgerald Tamayo in Orlando, a former president of the FPA who helped write the board’s original practice standards more than 20 years ago. The board gave the draft to Moisand to review before its release.

The new requirement, if adopted, could pit CFPs against powerful employers with, potentially, their jobs or their certifications hanging in the balance, as he sees it. Moisand says he wonders how additional comments might impact that section.

“That’s why [the board] put that out for public comment,” Moisand says.

Supporters of the Labor Department’s new fiduciary rule, which is being phased in starting June 9, say the rule will help prevent large firms from hiding or misrepresenting their compensation models to clients.

The board’s draft also calls for another big change: It stipulates that CFPs owe clients a fiduciary duty, but clarifies that statement in the next sentence by saying this holds only “when providing financial advice.” A fiduciary duty is defined as a commitment to putting a client’s financial interests ahead of an adviser’s.

For years, the CFP Board’s critics have argued that, in requiring fiduciary care, the board should not create any exemptions.

It’s this point that led Welsh to say the board is trying to have it both ways: acting the part of the fiduciary standard-bearer while allowing commission-driven brokers to join its ranks.

However, Houlihan says the draft’s definition of “financial advice” is highly detailed, so much so that it would be difficult for an adviser to argue that many, or even any, of their client engagements amounted to anything other than financial advice.

“It would be hard for me to believe that — unless you specifically said, ‘I am doing nothing but order-taking’ — you are holding yourself out as a financial adviser, and you have given financial advice in the past, and now [a client] has called with a hare-brained idea and now all of a sudden you aren’t?” Houlihan asks.

RULES ON COMMISSION SALES
Another section of the draft rules includes a detailed definition of various forms of commission sales. Advisers could use those definitions as a roadmap when they determine which of their clients they should ask to sign a best interest contract exemption, Welsh says.

Under the fiduciary rule, advisers to retirement accounts may sell commission investment products if their clients sign an exemption.

This part of the draft may give clarity and comfort to wirehouse advisers who want to know exactly how they can comply with the board’s qualified fiduciary requirement while continuing to sell commission products, Welsh says. The board did not respond to his comments.

“They put a BIC inside the code of conduct, which is just ridiculous,” Welsh says. “They did it on purpose because they know their growth will be coming from the commission-based world.”

He offered an example: “That 9% loaded REIT is not good for clients, but it’s good” for advisers compensated based on product sales, Welsh says, adding that the board has spelled out “how you can keep selling that and still be a CFP.”

If the board’s fiduciary claims were as serious as they’re being billed, it would not allow CFPs to sell this kind of product, nor many others, he argues. “It’s designed to create an open door for the wirehouses and the commission-based brokers to maintain the CFP,” Welsh says.

There are currently more than 77,700 CFPs; the board projects the number to reach 80,000 by September. New CFPs bring additional revenue to the board, which has seen its ranks grow by 40% over the decade Keller has led the organization.

LARGEST FIRMS EVOLVING?
Houlihan thinks the largest firms are starting to embrace a truer fiduciary level of service, both because of the Labor Department’s rule and “because it’s good business,” she says.

Any firm that loses CFPs because it doesn’t let them provide client-first service could lose some of the industry’s best advisers and their clients, she says.

“I believe in market forces,” Houlihan says. “This is out there now.”


Video

Why invest in emerging markets?

Partner Insights
Sponsor Content From:


Columbia Threadneedle Investments


Ann Marsh

Web Seminar Goals-based planning

Goals-based planning is a radical – even disruptive – approach to portfolio construction that is sweeping financial planning. In goals-based planning the entire portfolio is constructed with specific objectives in mind. It renders current approaches to portfolio construction such as core-satellite obsolete, or so argue adherents.

Goals-based planning brings with it many questions: What is the best way to reach goals? Should advisors construct multiple portfolios or a single one? Which investments to use? How should the portfolio be benchmarked? What insights does behavioral economics bring?

This one hour webinar will establish the foundations of goals-based planning including current issues surrounding this approach as well as how best to implement it. Join us for a discussion of this next frontier of portfolio construction.

Key Speakers

Written Financial Plans Help Americans Make Good Choices

People with written financial plans
are more confident, more engaged with their wealth and demonstrate more
positive saving and investing behaviors than average Americans,
according to Charles Schwab’s new Modern Wealth Index.

Just 24%
of Americans say they have a financial plan in writing. The index found
54% of those with a written plan increased their 401(k) contributions in
the past year, significantly higher than the percentage to do so among
those without a written financial plan. Half with a written plan
rebalanced their 401(k) portfolio, compared to 24% without a written
plan.

In addition, 83% of those with a written financial plan are
aware of the fees in their brokerage account, 45% have an emergency
fund, and 40% stick to a monthly savings goal, compared to 67%, 26% and
19%, respectively, of those without a written plan.

According to
the index, more than one-third of Millennials (34%) say they have a
written financial plan, compared to 21% of Generation X and 18% of Baby
Boomers. Nearly three-quarters (72%) of Millennials developed their
written financial plans with professional help, and 91% of them review
or update their financial plans at least annually.

However, some
Millennials’ immediate money habits do not coincide with long-term
planning. Six in 10 lack a monthly savings goal (62%) or a household
budget (58%). Less than one-third (30%) have built an emergency fund to
cover at least three months of living expenses

Millennials also
have room for improvement when it comes to debt management. Two-thirds
(67%) say they don’t always make their student loans and mortgage
payments on time, and nearly seven in 10 (69%) say they have credit card
debt.

As Millennials age, their habits appear to improve,
however. Among older Millennials in their thirties, 57% say their
financial health is better than it was five years ago and nearly half
(47%) say they have a household budget compared to those in their 20s
(35%) who admit they do not.

The Modern Wealth Index, developed
in partnership with Koski Research and the Schwab Center for Financial
Research, is based on Schwab’s Investing Principles and composed of 60
financial behaviors and attitudes—each assigned a varying amount of
points depending on their importance. The index broadly assesses
Americans across four factors: goal setting and financial planning,
saving and investing, staying on track, and confidence in reaching
financial goals. Based on the total number of points received,
respondents were indexed on a 1 to 100 scale for each of the four
factors and an overall score.

The online survey was conducted by Koski Research from April 12 to April 20, 2017, among 1,000 Americans ages 21 to 75.

Written Financial Plans Drive More Positive Savings Behaviors

People with written financial plans are more confident, more engaged with their wealth and demonstrate more positive saving and investing behaviors than average Americans, according to Charles Schwab’s new Modern Wealth Index.

Just 24% of Americans say they have a financial plan in writing. The index found 54% of those with a written plan increased their 401(k) contributions in the past year, compared to 33% those without a written financial plan. Half with a written plan rebalanced their 401(k) portfolio, compared to 24% without a written plan.

In addition, 83% of those with a written financial plan are aware of the fees in their brokerage account, 45% have an emergency fund, and 40% stick to a monthly savings goal, compared to 67%, 26% and 19%, respectively, of those without a written plan.

According to the index, more than one-third of Millennials (34%) say they have a written financial plan, compared to 21% of Generation X and 18% of Baby Boomers. Nearly three-quarters (72%) of Millennials developed their written financial plans with professional help, and 91% of them review or update their financial plans at least annually.

However, some Millennials’ immediate money habits do not coincide with long-term planning. Six in 10 lack a monthly savings goal (62%) or a household budget (58%). Less than one-third (30%) have built an emergency fund to cover at least three months of living expenses

Millennials also have room for improvement when it comes to debt management. Two-thirds (67%) say they don’t always make their student loans and mortgage payments on time, and nearly seven in 10 (69%) say they have credit card debt.

As Millennials age, their habits appear to improve, however. Among older Millennials in their thirties, 57% say their financial health is better than it was five years ago and nearly half (47%) say they have a household budget compared to those in their 20s (35%) who admit they do not.

The Modern Wealth Index, developed in partnership with Koski Research and the Schwab Center for Financial Research, is based on Schwab’s Investing Principles and composed of 60 financial behaviors and attitudes—each assigned a varying amount of points depending on their importance. The index broadly assesses Americans across four factors: goal setting and financial planning, saving and investing, staying on track, and confidence in reaching financial goals. Based on the total number of points received, respondents were indexed on a 1 to 100 scale for each of the four factors and an overall score.

The online survey was conducted by Koski Research from April 12 to April 20, 2017, among 1,000 Americans ages 21 to 75.

Lakeland CPA Recognized As One Of The Top Financial Planners In Nation

 

Lakeland Chamber Of Commerce Blog by Cory Skeates

Matthew A. Treskovich, CPA/PFS, CFP®, CMA, MBA, with CPS Investment Advisors, has received the Personal Financial Planning (PFP) Standing Ovation from the American Institute of CPAs (AICPA). He is one of 16 CPAs to receive this award, which will be presented at the AICPA’s Advanced Personal Financial Planning Conference in Las Vegas.

“The AICPA is pleased to recognize each of these honorees for their contributions to personal financial planning,” said Andrea Millar, CPA/PFS, AICPA’s Director of Personal Financial Planning. “Each of these young PFS credential holders has gone beyond providing excellent client services to earn this honor. Their work underscores the contribution CPAs are able to make in the field of financial planning at an early age.” The Standing Ovation program recognizes young CPAs who exhibit outstanding professional achievement in specialization areas.

Treskovich joined CPS Investment Advisors in 2016 after spending 18 years in the insurance industry, and 12 as CFO of an insurance brokerage. Matt has a Bachelor’s degree in Physics from the University of Central Florida, and an MBA from the University of Phoenix. He is a Certified Public Accountant, Personal Financial Specialist, CERTIFIED FINANCIAL PLANNER™ and a Certified Management Accountant.

“Matt is a valuable asset to our firm and to our clients. He is exemplary when it comes to financial planning and goes beyond all elements to help our team every day. He is well deserving of this distinguished honor,” said Peter Golotko, CPA/PFS, MBA, President of CPS Investment Advisors.

Complete Article Here: Lakeland CPA Recognized As One Of The Top Financial Planners In the Nation 

Father-son financial planners embrace tech tools

Financial planner Ted Demars founded what would become family-run Demars Financial Group LLC here in 1973, when he was still doing mostly insurance work, and the handheld electronic calculator was just coming onto the scene.

Though such calculators initially cost upwards of $350, they were 10 times faster than the conventional mechanical calculation tool called a slide rule, when it came to working up insurance rates.

“It sure made life a lot easier,” he says.

Demars Financial Group, in which his son David Demars also is a principal and a financial planner, continues to integrate technological innovations in its services with advanced finance software and often providing live presentations to remote clients, he says.

Ted Demars takes pride in the company’s videoconferencing capabilities, which are convenient for clients who can’t easily travel to the company’s office in east central Spokane.

“They can see exactly what they would see if they were here in the office,” he says of videoconferencing capabilities.

Demars Financial Group has been located in the Tapio Office Center, at 104 S. Freya, for 20 years, and currently occupies 2,500 square feet of office space in the center’s Lilac Flag Building. 

In addition to the two principals, the company employs an investment analyst and a support staff of three people.

Today, Demars Financial Group primarily offers independent advisory investment services, with securities brokered through California-based Crown Capital Securities LP, although life insurance is still an important component of financial and estate planning, he says.

David Demars joined his father’s business in 1996 after having worked several years for the big, London-based Price Waterhouse accounting firm now known as Pricewaterhouse Coopers.

Price Waterhouse had stationed him in Venezuela, where the focus of his work was with oil companies.

“It was demanding more travel,” he says, adding that he was ready to relocate to Washington state when the opportunity arose.

“My father gave me an invitation to join him, and I liked the opportunities he had to work with people,” David Demars says, adding, “I’m still here 21 years later.”

He is one of 11 siblings, and the only one of them to join his father as a professional financial planner.

Adds Ted Demars, “He makes the business certainly better than when I started.”

Most of Demars Financial Group’s clients initially come to the company to work out strategies to “retire and stay retired,” Ted Demars says. Some clients also are looking for tax-savings strategies.

David Demars says prospective clients often approach Demars Financial Group with a number of questions about how to set and attain goals for financial well-being.

After a meeting or two, they often leave the office with greater confidence about integrating financial and estate planning, wealth management, and insurance, with an outlook toward retiring in comfort and leaving behind a legacy, he says. 

“We do our best to work with whatever circumstance the client may be in,” he says. “We have regular meetings with clients and try to match what we think we know about their risk tolerance with what might or might not have changed.”

Ted Demars adds, “We don’t promise to accomplish miracles, but when people come in, we work with what they have.”

Most strategies involve investments in securities, such as stocks, bonds, mutual funds, and exchange-traded funds, while aligning individual risk tolerance and time horizons.

Many clients also want peace of mind, knowing their spouse will be taken care of in their absence, he says.

“People need life insurance. It’s not our main focus, but it happens,” he says. “When I started the business, we seldom had a death claim,” he says. “Now it’s happening on a very regular basis. … They’re passing on, and we’re seeing the goals we worked for coming to pass.”

Adds David Demars, “Our services are needs based or goals based rather than product based.”

Demars Financial Group generates about 80 percent of its revenue through fees, and 20 percent through commissions, he says.

Today, Demars Financial Group has 400 clients and manages $80 million in client assets, according to the Demares.

David Demars says clients are mostly individuals and small businesses.

New clients often come to Demars Financial Group through referrals from and beneficiaries of longtime clients.

Most clients live in the Pacific Northwest, if not specifically in the Spokane area, although the company’s client base isn’t geographically limited, thanks to videoconferencing technology.

Demars Financial Group also has grown its client base through acquisitions of four other small financial-planning firms.

In its most recent acquisition, it acquired the financial planning business of Peter Bock CFP, of Spokane, in 2012.

Peter Bock has stayed on at Demars Financial Group as its investment analyst.

“His clients had similar needs to ours,” David Demars says. “Transitioning his business into our business was a very good fit for his clients.”

David Demars says he’s comfortable with the current size of the company, although the owners are on the lookout for new clients and growth through acquisition.

“We’re not looking to become the biggest business on the block,” he says.

Introduction to Financial Planning

We all appreciate the value of maintaining a financially stable home. We budget our income, expenditures, and save for future expenditures, milestone family events, eventual retirement, and maintain an emergency fund to cover unplanned expenses in case of serious illness, disability, surgery or possible unemployment. In this series of articles, various topics of personal financial management will be discussed.

Personal and family financial planning can conveniently be divided among the following areas:

  1. Budgeting and basic record-keeping
  2. Insurance, including health, life, liability and disability insurance
  3. Tax planning
  4. Asset management
  5. Management of IRA, 401(k) and other retirement accounts
  6. Estate planning
  7. Financing education

Personal financial management has become complex and usually requires time for regular maintenance, modification or periodic upgrading. Use of and familiarity with computer-generated spreadsheets is very helpful. For many it is desirable to engage the services of a professional financial planner. The purpose of the financial planner is to act as a captain or quarterback and assist or organize the major financial areas described above to obtain the most value from one’s limited financial resources.

Selecting the proper financial planner is essential. It is valuable and advisable to go to the office of the planner and forgo the convenience of having the planner come to your office or residence. This provides an opportunity for you to observe the planner’s workspace—particularly regarding the planner’s orderliness and method of functioning. You might be reluctant to work with a planner whose office is chaotic or disorganized.

The planner should be concerned with more than simply your total financial assets, and should be interested in many other relevant aspects of your life—family structure, health, religious needs, goals etc. While anyone can call themselves a financial planner, the Certified Financial Planning Board certifies individuals who have had required education, passed a certifying examination, have had experience with a financial planning firm and adhere to the organization’s prescribed ethical standards, with a CFP designation. The College for Financial Planning also certifies other retirement specialists with the degree of Chartered Certified Planning Counselors (CRPC). The CRPC® program comprehensively covers all aspects of the retirement process.

Compensating financial planners for their time and effort is of course very relevant in the decision to engage such an individual and in evaluating its cost effectiveness. There are two well-known standards of compensation for financial advice. These are the fiduciary standard and the suitability standard. Traditionally, Registered Investment Advisors (RIAs) were known for their adherence to the fiduciary standard—brokers and employees of brokerage firms typically adhered to the suitability standard. The fiduciary standard demands that advisors always act in the best interests of their clients, and put their clients’ interests above their own. The suitability standard means that as long as an investment recommendation met a client’s defined need and objective, it is deemed appropriate. The Department of Labor issued a ruling that all financial advice regarding retirement accounts adhere to the fiduciary standard. This is slated to go into effect on June 9, 2017. It is expected that those who work on commission, such as brokers and insurance agents, will be impacted the most by this change. Annuity vendors also will have to disclose their commissions to clients, which could significantly affect sales of these products. Annuities have been a source of controversy, as they usually involve high commissions and many have other charges and fees that can reduce the returns to their purchasers. The new rule could therefore eliminate many of the existing commission practices.

Financial planners are most often compensated on an hourly fee basis. When the planner will also be managing one’s asset portfolio, the fee may as well be based on a percentage of the assets under management. The planner’s fee structure should be clearly understood before agreeing to become a client. A Registered Investment Advisor (RIA) is regulated by state or federal authorities and must adhere to rigid standards. RIAs adhere to the fiduciary principles. This means they have a fundamental obligation to provide appropriate investment advice and must always act in their clients’ best interests.

We always have financial needs so planning is always relevant and present. These change as we age. In our 20s and 30s, we may be concerned with financing our children’s education and saving for their higher education or professional training. As we approach our late 30s, 40s and 50s we are concerned with financing our children’s education or professional school, their marriages, and gifting grandchildren. While retirement planning should begin when earnings commence, as we approach our 50s this becomes more urgent. When we get over age 60, planning retirement, retirement financial goals, possibly moving to a new home or locale and estate planning achieve paramount importance. In this series, many of these areas will be covered in depth. In this first article in this monthly series, I am soliciting readers’ comments and criticisms as well as questions and suggestions for future articles.

Norman Sohn received his MD degree from New York University and his MBA from Fairleigh Dickinson University. He completed a 15-month course in financial planning. Since his retirement from his position at Lenox Hill Hospital in 2010, he has been working at Beacon Wealth Management, LLC — a financial planning and wealth management firm in Hackensack. He completed his Series 65 examination, which qualifies him as an investment professional and allows him to operate as an Investment Adviser Representative. He also passed the Chartered Retirement Planning Counselor examination, which provided him with the designation CRPC®. He lived in Englewood for over 40 years and for the past four years has been married to Lois Blumenfeld and living in Teaneck. Together, they have seven children, 26 grandchildren and a host of great grandchildren. He is an active member of Congregation Bnai Yeshurun. He can be reached at [email protected].

By Norman Sohn

 

 

Financial planning report shows positive movement

With a strong reserve balance and an upgraded bond rating cited in a report from Ehlers, a financial advisory planning company, the mood was positive at the June 5 Cottage Grove Village Board meeting.

“The village has a strong bond balance. This shows the village commitment towards high financial planning,” said Greg Johnson, senior municipal adviser for Ehlers.

He said the village’s reserve balance is in good shape.

The bond rating improved from AA- to AA by Standard Poor’s, where strong management and very strong budget flexibility of the village was noted. Standard Poor’s also made note of the village’s commitment to long-range financial planning and a fund balance at 26 percent of total operating expenditures.

“We’re pleased to see the very positive review of the village’s finances from Standard Poor’s.  The village’s upgraded bond rating, from AA- to AA, helped save the village approximately $250,000 during its latest bond sale,” Village Administrator Matt Giese said in an email to The Herald-Independent on June 9. “The village’s healthy balance of cash reserves and long-range financial management plan will help to keep the village in solid financial standing for many years to come.”

The report also documented notable recent developments in the village.

The UW Medical Clinic opened in 2016, with a current assessed value of $3,529,200 and 14,000 square feet; Stihl, a distribution site, opened in 2015 with 65,750 square feet and a current assessed value of $4,561,700; and Culver’s opened with a 5,000-square-foot building.

Aster Memory Care, a 24-bed facility completed its construction; the construction value listed on the building permit was $2.2 million. Drumlin Residences, which features 60 units of senior apartments, is currently being built. The construction value listed on the building permit was $2.75 million.

Pending developments listed in the report are Atlantis Valley Foods, a light industrial building, estimated value of $1.8 million, and Rainbow Day Care of 11,000 square feet with an estimated value of $2 million.

Summit Credit Union has a developer agreement signed and a general development plan approved. Construction of the new headquarters is expected to begin in 2018. The developer’s agreement anticipates about 120,000-140,000 square feet of space valued at $17 million by Dec. 31, 2020.

Johnson stated in the conclusion of his report the 2017 capital projects identified in the 2016 plan were financed earlier this year and that operating forecasts and the capital improvement plan will be updated.

Ehlers has worked with the village since 2013. They assist the village with debt issuance for capital projects, refinancing of existing debt, financial planning and long-term planning, economic development such as tax incremental finance district monitoring and development agreement negotiations.

Powell: How to make your own financial wellness program

Many employers are starting to offer their workers financial wellness program in the workplace. And with good reason. The research seems to indicate that these programs pay off.

But what if you don’t have such a program at work? Well, you’ll have to build your own. How might you go about that?


Knowledge is power

In the main, financial wellness programs tend to focus on education about money basics, including budgeting, debt management and retirement planning. You can create your own financial education/wellness programs by taking advantage of the many free resources on the web.

For instance, the CFP Board and the University of Illinois offer a free, online financial planning course as does Bank of America and Khan Academy. Other resources include the American Institute of CPAs, the Financial Fitness blog, HelloWallet and the Society of Actuaries.

Of note, employers that believe they have a responsibility to educate their employees on financial issues tend to have more successful programs, according to Julie Stich, associate vice president, content, at International Foundation of Employee Benefit Plans and author of What Makes a Workplace Financial Wellness Program Successful?


Build a budget

For his part, Rob Austin, director of research at Alight Solutions, says the first step in creating a do-it-yourself financial wellness program starts with a plan, a budget. “While nobody really likes to do this step, it sure beats not having enough money at the end of the month to pay bills,” he says.

Others agree. Greg Ward, a senior financial planner at Financial Finesse, suggests keeping track of what comes in and what goes out using smartphone apps, online banking, spreadsheets or even paper and pencil. “They have to track how much comes in and where it goes if they are going to build a solid foundation,” he says.


Set goals

Begin with the end in mind, says Ward. “We talk with so many people who want help managing their money but they haven’t thought about what they are managing it for,” he says.

In theory, achieving a state of financial well-being is a relatively straightforward process, Ken Steiner, a retired pension resource actuary, in his paper, Using Sound Actuarial Principles to Enhance Financial Well-Being. “It is achieved through a combination of one, accumulating sufficient assets and two, properly managing those assets to accomplish one’s financial goals.”


Save as much as you can, as early as you can

It’s always good, says Austin, to have some funds “squirreled away to pay for that phone screen that cracks or that car ‘check engine’ light that comes on.”

What’s more, Austin says, it’s never too early to start saving for retirement either. “With good stock market returns, a few dollars invested today can be worth hundreds in retirement,” he says.

If you haven’t done so already, start contributing to your 401(k) and sign up to have your contribution increase each year automatically.

“Also look to see if you 401(k) plan has features like target-date funds or managed accounts,” Austin says. “These features can bring professional expertise to your retirement savings.”


Maximize the benefits you already have

“Underutilization of benefits is a big problem,” says Ward. “So, working with their HR manager and understanding how each benefit works so that they can make sure they do not leave money on the table.”


Work with an adviser

Working with an unbiased financial coach can also boost your financial wellness, says Erik Carter, the resident financial planner at Financial Finesse. “You can find financial planners who don’t sell products and who don’t have asset minimum requirements” and any number of places including, he says, the Garrett Planning Network, the Alliance of Comprehensive Planners, and the XY Planning Network.

Others agree that asking for help is part of a do-it-yourself financial wellness program. “There are plenty of really good-intentioned financial advisers who can help individuals establish a path to financial freedom,” says Austin.

MORE POWELL:

Robert Powell is editor of Retirement Weekly, contributes regularly to USA TODAY, The Wall Street Journal, TheStreet and MarketWatch. Got questions about money? Email Bob at rpowell@allthingsretirement.com.

Why A Comprehensive Financial Plan Should Include A Life Coach

Shutterstock

One of the most important roles of a financial advisor is helping clients prepare for retirement. Advisors are trained to evaluate a client’s economic situation and develop a strategic plan to best position them to accomplish their goals. However, finances are only one piece of the puzzle. Oftentimes, an investor may financially have the ability to retire, yet making the emotional decision to leave their career is a challenge.

What Holds People Back From Making The Transition Into Retirement?

As a financial advisor, one of the most common reasons I see people delaying the transition is the element of uncertainly in what comes next. Even the most diligent savers and investment-savvy individuals can be paralyzed when faced with identifying what will bring them satisfaction and joy in the next chapter of life.

While it’s critical to have your financial affairs in order, it’s equally as important to plan for the mental, social, and spiritual aspects of retirement. Ask yourself questions such as, “How will I fill up my days and keep myself busy?” or “What will my new routine look like?” and “My career has given me a sense of purpose for decades, what comes next?” To help answer these questions, I recommend bringing a life coach into the retirement planning conversation.

Incorporating A Life Coach Into Retirement Planning

While financial planning and life coaching have traditionally been independent of each other, integrating the two can be extremely beneficial. By working through your plan more comprehensively, you will feel more comfortable and confident in making the transition.

How Does Life Coaching Work?

A life coach can often tap into concerns you don’t even realize exist, and will provide valuable tools, perspectives, and support systems to prepare you for the next phase.