LIFE STAGES OFFER CUSTOMIZED PLANNING OPPORTUNITIES
November 1, 2021
Financial planning is at the heart of how we help our clients at The Mather Group, LLC (TMG). Because the comprehensive and customized planning we provide fosters strong, long-term relationships, the TMG team has the privilege of seeing the direct impact it has on our clients’ lives—day-to-day and over time. Different stages of life offer distinct opportunities to illustrate how transformative it can be to have a time-tested financial planning framework and a trusted, experienced advisor as your guide.
Here, we will highlight considerations that are relevant to various life stages and also provide real-world anecdotes from TMG’s Regional Directors, who have guided our clients through these transitions. While every financial planning scenario is as unique as you are, the common thread among these examples is that each client has a personalized financial plan that creates the foundation for decision-making.
EARLY CAREER
Many times, younger people who are just getting started in their careers need help creating a savings priority plan. While the multitude of account types for saving can cause confusion, these options create opportunity for you to maximize savings based on your unique goals and situation. Common examples of account types are taxable brokerage accounts, employer-sponsored plans, and individual retirement accounts (IRAs)—both Traditional and Roth. Proper utilization of these accounts can make a meaningful difference over your lifetime, not only in dollars earned, but also by providing flexibility to deal with the unexpected financial difficulties life can throw at us.
Laura Barnett Lion, CFP®
"I am reminded of a client’s son with whom I worked early in my career. The son was in his late 20’s and already had close to $50,000 invested in his IRA. I was amazed and impressed at how investing so early—thanks to odd jobs during his teenage years—could make such a big difference. It illustrated the magic of compound interest over time. Recently, my 18-year-old son was inquiring about Bitcoin and Roth IRAs given his newfound interest in the financial markets. I shared this story with him, along with Warren Buffett’s sage advice about starting early: ‘I started building this little snowball at the top of a very long hill. The trick to having a very long hill is either starting very young or living to be very old.’ We never know what twists and turns life has in store for us but saving early can more than offset a few later years of not being able to do so."
Brian Schmehil, CFP®, CRPC®
"I helped a client, who did not have much in retirement savings but received millions of dollars in options, decide how many options to exercise right away in order to get their future retirement on track. Once we built a financial plan and figured out how much money that was, we were able to do a cashless exercise to contribute those funds into the most tax-efficient retirement accounts and invest in a diversified portfolio. The client was then able to comfortably take on the additional risk by holding the remaining options over the course of a few years, maximizing their potential return while minimizing taxes."
MID-LIFE
At some point, you may find yourself re-assessing your priorities or navigating a career change, whether voluntarily or involuntarily. While a high-paying job can help to amass a great deal of savings, there may come a time when spending more time with your family or reducing stress take precedence. Exploring the trade-offs of working less, saving less, or changing jobs can help create flexibility and give you a great deal of confidence.
Bryan Hankla, CFP®
"A client in his 40s came to me with an aggressive goal of retiring in his early 50s. His high-paying job allowed for substantial annual savings but also induced a lot of stress and time away from his young children. The aggressive saving posture was also restricting his ability to enjoy some of the wealth he was creating. We were able to model multiple scenarios to help him develop a better balance between saving and enjoying his wealth. While it extended his career arc, it also gave him clarity about tradeoffs. This helped relieve the pressure to save so aggressively and gave him more confidence to spend on things like vacations with his family and other experiences he previously felt he had to forgo to achieve his goals."
Amanda Muse, CFP®
"I have a client who has a very stressful work environment due to layoffs. There is a lot of fear in the workplace, and he no longer enjoys what he’s doing but his plan has been to work for another 2-3 years. However, we were able to adjust the plan and give him confidence that he could retire now and still achieve the goals we laid out. He has not left yet, but knowing that he has the ability to go when he is ready and that his family’s financial future is sound has relieved a great deal of the stress he was facing every day."
Other various life events can also impact our financial future. A common example is an inheritance, where guidance is needed on how best to deploy these new resources while balancing retirement security with enjoying an enhanced lifestyle. More complex examples include becoming eligible to execute options or determining how much equity a business owner should roll into a new venture as the result of a merger or acquisition.
Bryan Hankla, CFP®
"We recently started working for a widow whose husband had been the primary manager of their finances. He enjoyed investment research and had accumulated a multitude of investments—both public and private—in a variety of accounts over the years. To complicate matters further, the ownership of these investments had been overlooked. This put the wealth in danger of not being distributed to heirs according to his wishes, so we worked with the widow’s attorney to resolve that. Then we consolidated these investments into fewer accounts with a more efficient structure. We also helped the widow understand her role as a steward of the assets, and we established monthly distributions to replace the income their household had received from his pensions and Social Security. This all helped to give her peace of mind."
RETIREMENT
As retirement approaches, a new set of considerations often enters the picture. It can take time to get comfortable with the idea that you will now be living off the money you worked so hard to save over your career. The behaviors that allowed you to accumulate wealth are often at odds with enjoying the wealth you’ve created. Organizing your data, goals, and other considerations into a framework can help you make informed decisions and be more confident about your choices.
Amanda Muse, CFP®
"I had a client who wanted to move to a new city in retirement. They had very specific requirements for where they wanted to live, and they were concerned about how the large purchase would affect their retirement plan. I talked with them about the possibilities, ran models, and gave them confidence that this goal was achievable. Then I helped them coordinate funding the purchase from their various retirement accounts in the most efficient manner. They are now happily moved into their retirement home, and it is very fulfilling for me to have been able to help them make this dream a reality."
Jennifer O’Hara, CFP®
"A number of my clients are so consumed with work that they neglect to consider what leaving their executive position will ultimately mean for their mental state and their family. I have guided many clients through the process of identifying the aspects of their lives that will be impacted, beyond their finances. I want them to be confident not only in their ability to financially weather another 30 years of living, but also in how their new daily experience will help to keep them mentally and physically healthy long into their retirement years."
The Mather Group, LLC (“TMG”) is registered under the Investment Advisers Act of 1940 as a Registered Investment Adviser with the Securities and Exchange Commission (SEC). Registration as an investment adviser does not imply a certain level of skill or training. For a detailed discussion of TMG and its investment advisory services and fees, see the firm’s Form ADV on file with the SEC at www.adviserinfo.sec.gov. This has been provided for informational purposes only and is not intended as a recommendation to purchase or sell a security.
The Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the CFP® certification mark, the CERTIFIED FINANCIAL PLANNER™ certification mark, and the CFP® certification mark (with plaque design) logo in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements. No federal or state law or regulation requires financial planners to hold the CFP® certification; it is voluntary. To obtain the certification, a candidate must have a bachelor’s degree from an accredited university or hold another approved designation, have three years of financial planning experience, and complete 30 hours of continuing education every two years.
The Chartered Retirement Planning Counselor (CRPC®) is issued by the College of Financial Planning and requires a timed, online exam after a self-study course. Continuing education requirements are 16 hours biannually.
