But no life is predictable and no bundle of assets does what we want them to do. The average client brings with them a mess of accounts, products, plans and custodians, all laden with the fingerprints of multiple advisors—with more hidden-away money they’re not telling you about. The average advisor despairs at coordinating all of these assets in an efficient way much less demonstrating their value.
A comprehensive, intuitive approach to helping clients get the most out of retirement share these virtues:
A focus on what you and your client can control. Advisors dread when clients fixate on market returns. The easy button answer of a coordinated, optimized ecosystem will put the spotlight on what you can actually control: 1) bringing down investment costs, 2) managing the risk and concentration of portfolios, 3) minimizing tax exposure through tax-smart asset location, tax-loss harvesting, true household-level rebalancing, and 4) optimizing Social Security benefits along with creating an optimal sequence of withdrawal across all accounts and income sources. These four levers are not only the only levers you can control, it’s the only way you can enhance the growth of their nest egg. Operating these levers will make your practice more profitable and efficient, and produce better long-term outcomes for your clients, regardless of what the S&P 500 is doing on a given day.
A way to measure success. How do you explain tax efficiency to a client? How do you show the difference an optimized Social Security filing strategy will make in their retirement? Whether it’s a scoring system or an intuitive, visual output, these tools have to make your work “real” in terms of dollars and cents. This kind of clarity leads clients naturally into conversations about what matters to them, instead of making them feel like you are pushing products.
While wealth managers, product manufacturers and fintech providers consolidate to build the elusive easy button, there’s no reason to wait for a perfect solution. Your clients need your help now. In coming articles, we will share with you the current roster of state of the art tools that show your value in disentangling the hard work of keeping their retirement dreams on track and how to get it done now.
Jack Sharry is co-chair of MMI's digitally enhanced advice community and executive vice president of LifeYield. LifeYield competes against and partners with some of the companies mentioned in this article.