Ask Money

Help with the transition to retirement

Chris Farrell Oct 27, 2010

Question: I’m still working full time at 69, eligible to retire, but uncertain about how to plan for the financial necessities of retirement. I began saving for retirement rather late (in my late 40s) but have been saving pretty aggressively since. How do I find a financial planner that I can trust and about what will it cost me to use the services of a financial adviser? I do not have millions but also am not impoverished. Being in the middle seems to be a bit ambiguous in terms of getting financial advice and planning. Thank you, Diane, Atlanta, GA

Answer: I think its great that you’re still working and now thinking about retirement at age 69! Your note reminds me of a column Henry “Bud” Hebeler wrote for his church newsletter. He’s the former president of Boeing’s aerospace unit and now a passionate proselytizer for sensible financial planning at analyzenow.com. Here’s what he wrote:

You don’t have to be a youngster to learn new things. With much concern about whether I could be a student again, I went back to college at 39 to get a degree in business. That changed my line of work. In my late fifties I learned how to use a computer and excel at Excel. In my sixties I learned enough about financial planning to be able to support myself if I wanted. I’ve produced programs that have tens of thousands of equations and are used by large numbers of people. In my seventies I was asked to write two books by one of the largest publishers, both books now sold by Amazon. Now in my late seventies, I have a Web site that gets to more than a million people every year, and I answer a number of e-mailed financial questions every day.

Now to your question. As readers of this blog know, I’m often wary of working with a financial planner for most people. But the expertise of a planner can be invaluable at major transition points, such as retirement.

Problem is, the classic middle-income household is where the financial planning need is the greatest, yet the options aren’t that great. What’s more, almost anyone can call themselves a financial planner. But in many cases their actual expertise is narrow. For example, the planner may be a stock broker without any real knowledge about retirement withdrawal rate options. Another planner may be well-schooled in insurance products but doesn’t have much insight into Social Security.

This is why I tend to like fee-only certified financial planners (CFPs). They have the education and the knowledge to deal with all aspects of household finances. There simply aren’t as many financial conflicts of interest with a fee, either. But this kind of advice is expensive. The planners mostly want to work with high net worth households.

However, I would check out the fee-only planners at the Garrett Planning Network. The planners target middle income households by breaking down financial planning questions into pieces, such as your retirement. (For a younger person it might be buying a home.) Another fee-only network is offered by advisors associated with the Alliance of Cambridge Advisors.

I would ask the planners you interview to clearly lay out what they can and cannot do for you. In other words, what kind of planning do they do? How often can you talk? What should you expect? You want to know how the planner makes money. And you want an experienced planner.

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