How to Find a Financial Planner with Expertise in Retirement Planning
Taking full responsibility for your financial future by being your own financial planner can be costly.
In, Retirement Planning: Most People Don't Know How Nor Even Think About It, research by Olivia Mitchell, insurance and risk management professor at Wharton School of the University of Pennsylvania, showed that, in general, people are not well equipped to handle their own financial planning and investment decisions. This presents a problem since, according to Mitchell’s analysis, there is a strong positive relationship between the level of financial planning and accumulated wealth. In her study, Mitchell found that those who planned a lot for their retirement had accumulated $202,000 in net worth versus $80,000 in median net worth for those who hardly planned at all. This is a substantial difference and is indicative that planning does create wealth. Overall, her study showed that the planners were wealthier than non-planners (excluding housing wealth).
Her study also found a strong correlation between financial literacy and retirement planning. She found that those who were more educated were more literate financially and tended to be more proactive at planning for their retirement. Unfortunately, her study revealed that much of the mature population was not as literate financially and this is one reason they often fail to plan.
However, even those who take the time to read books and attend seminars to educate themselves can make critical mistakes that can have extremely adverse financial consequences for them and their beneficiaries and ruin their plans for retirement and the distribution of their wealth. Although some people may enjoy buying and managing their own investments, most people lack the financial expertise required to effectively manage their own financial affairs on a regular basis over a long period of time. Not surprisingly, by trying to navigate the many complex aspects of financial planning without professional guidance, they frequently make critical and costly mistakes. In addition, they are often unaware of various wealth-building strategies that could increase the magnitude and longevity of their wealth for retirement.
The fact of the matter is that financial planning is too complex and difficult for most individuals to do themselves. It involves a number of interrelated areas such as asset allocation, investment planning, retirement planning, insurance needs, tax planning, as well as charitable gifting, legacy planning and estate planning. Adding to the confusion is the fact that each area is constantly evolving. Those who think they can do it all by themselves may be jeopardizing their retirement. The need for accurate, objective, strategic and timely advice from a financial planner with expertise in retirement planning is essential. The need to have updated financial advice is also extremely important. The information you received last year may no longer be accurate and up to date. A retirement planning specialist should review and update your wills, trusts, investments, insurance policies and financial plans on a regular basis to adjust for changes in tax laws, your personal or financial situation, your financial goals and risk tolerance, and to incorporate new financial strategies.
If you have any issues or areas of concern regarding your retirement or investment objectives and if you live near Pittsburgh, please contact Bill Griffith, Jr., CFP® of W.E. Griffith & Associates, LLC, a wealth management firm located in Washington, Pennsylvania. He has been providing specialized strategies and services for ensuring long-term financial independence and security for many years. He has written numerous articles about various topics relevant to personal finance, retirement and investment planning.
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