OUR APPROACH

Our Approach

Retirement planning can be intimidating and complicated. Our approach is to make the intimidating painless and the complicated simple.






What is important to you?

At EFS, we focus on what matters most to our clients. Every client is different. That's why every retirement plan is different.

It starts with helping clients think about their life goals...their dreams...their ideal life. We ask questions like, "What would you want to do if you didn't need to work for money?" or "What are the most important dangers, opportunities, and strengths you need to address?"

This conversation allows us to create a plan around each client's most cherished values. That is the purpose of a financial plan--to help you live your ideal life without fear, distractions, or financial mistakes.

As your adviser, my job is to give you answers to your financial questions in plain English, so that you can make educated and informed decisions about your retirement.  We use a carefully designed no-cost, no-obligation process  for showing you exactly how we can help make your retirement a success before you pay us a penny in fees or trust us with a dollar of your nest egg.

 
Setting Goals

The next step is realistic goal setting. With the client's life goals as the bullseye, we can get down to setting specific financial goals to achieve that end.

Many things have to be considered at this stage, such as life expectancy, retirement age, work options, cash flow, investment amounts, investment types, income sources, living expenses, debt, taxes, insurance, inflation, inheritance goals, and health related issues.

At this intersection, there are many trade-offs. Making the right trade-off decisions is vital in achieving the right results and hitting the target.

Testing Trade-offs

A key part of making crucial trade-off decisions is testing those decisions. This testing can tell clients if they are ready to retire, at what age, and with what expected after-tax income.

Multiple iterations of historical scenarios can test a client's retirement readiness. We want a plan that has a high probability of success.

This approach assures clients that their goals can be met during good and bad economic situations. Stress testing also highlights areas of vulnerability that can be addressed.

Guidance rules are used to establish guardrails to insure a retiree doesn't run out of money or leave a mattress full of money they could have enjoyed. We simplify this complex math problem into a simple, one-page income strategy report that clients really appreciate.

Aligning Investments with Goals

Another vital part of a good retirement plan is aligning clients' investments with their goals. We help clients choose and maintain the specific mix of investments that can best deliver the results they need--using a disciplined, research-driven approach.

All investments have risk. Even "safe" investments over long periods have inflation risk. No single investment delivers high growth, high income, and safety of principal. The key is designing a portfolio that balances them in a way that supports the client's retirement objectives.

Investing in retirement (emphasis on preservation and distribution) is quite different from investing for retirement (accumulation). And this transition needs to start before retirement. Studies show that a diversified portfolio of stocks and bonds can deliver clients better results if there is just a small degree of flexibility in withdrawals during bad years. Getting the right mix at various stages is the key to investment success.

Here is another way to view asset allocation.
1. Bonds are for stability and higher yield--for the short term. (Don't worry; an income ladder of diversified individual bonds held to maturity eliminates interest rate risk).
2. Diversified stock funds are for long-term growth. (Don't worry; the short-term volatility of stocks is irrelevant if the time horizon is a decade or more).

Of course, the investments must serve the client's goals, not the other way around.  We recommend what we believe to be the best investments available for the sole purpose of supporting our clients' goals.  This is the difference between advice and sales.

Read our Investment Philosophy for more details.
Optimizing the Plan

Another important benefit of our planning is optimizing all of a client's finances toward all of their goals. For many clients, this means securely receiving the most after-tax, inflation-adjusted income for life. For some, it is increasing total wealth. For others, the focus is preservation and managing risks.

For example, we help clients avoid costly Medicare enrollment mistakes by providing unbiased guidance. We help clients optimize their Social Security income by testing different claiming options. If needed, we also advise clients on how to make decisions that maximize their pension income, based on their needs and goals.

By projecting clients' future cash flows, we can use various tax strategies to increase net worth and/or after-tax income. How a person positions assets in various accounts, liquidates assets, and withdraws assets can make a big difference. We also look at charitable giving and various Roth IRA strategies. We don't just look backwards at the previous year as a history teacher; we look forward twenty to thirty years to discover ways to lower our clients' lifetime tax liability.  

We study hard so we can recommend creative, well-researched strategies that will make the biggest impact on your retirement success. This is why we are so serious about forward-looking tax planning, where lifetime savings from these strategies alone can save you tens or hundreds of thousands of dollars--dollars that can be used to fulfill your family's dreams and goals.
  
If your current advisor doesn’t help you with these tax saving strategies, you may want to look for one who does. We're not saying hire us. But at this point in your life, you might need an advisor who includes this important aspect of financial planning in his practice. 

By using these income optimization strategies in combination with sound tax planning and investing principles, clients can sometimes earn or save tens or hundreds of thousands of dollars over a lifetime.

We have found that clients love for us to boil it down to the main actions needed for them to reach their goals. So that's what we've done. We use a one-page financial plan that makes it simple to focus on the main things. 

Of course, life is not static. Life happens. That is why having a planning relationship is important. Planning is a process, not a one-time event or product. By staying on top of the situation, and making necessary changes early rather than later, clients can feel confident they are not veering off track due to life's inevitable road bumps.

In the process, clients often experience breakthroughs, realizing they really are going to be OK. And they often realize they can actually dream a little bigger.


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