When engaging with professionals in fields such as Taxation, Finance, Medicine, Law, Insurance, etc., it can sometimes be challenging to identify the topics we want to delve into since we often don't know what we don't know.
Keeping this in mind, I aim to give you a high-level overview of what you can expect when working with us. It's worth noting that all our sessions start and end with a Q&A. I recommend keeping a folder at your desk. Between meetings, you can add any questions, concerns, or papers you'd like to discuss to this folder. This approach provides a solid starting point for our conversations.
Our main objective during reviews is to focus on your questions and concerns. Therefore, we'll discuss your priorities.
1. Asset Allocation - Building a Financial Foundation
We encourage you to divide your assets into three categories: a Now, Soon, and Later Bucket. You'll want funds in a savings/checking account for anticipated expenses in the upcoming year - the Now Bucket. The Soon Bucket should include assets you'll require in the next ten years to meet income gaps and known expenses. These assets should be invested to meet inflation and carry minimal volatility/risk. The Later Bucket will consist of assets you'll need in eight-plus years, invested accordingly.
2. Portfolio Performance - Understanding the Numbers
Performance discussions often involve percentage increases or decreases in your investments. However, this can be confusing for some. The performance of a portfolio over a specific period is relative to the risk taken, the overall market, and comparable investments.
3. Taxes - Tailoring Strategies to Your Unique Situation
Tax discussions are typically personalized, specific to your situation. The focus could be as simple as increasing your 401(k) contribution, or more complicated, like converting an IRA to a ROTH IRA, among other tasks. Paying attention to simple tax strategies can save you significant money over time.
4. Income/Expenses - Charting Your Financial Journey
We have cutting-edge technology to help you visualize your income and expenses over extended periods, focusing on the present and future. These programs can highlight potential deficits or surpluses based on life events like Social Security enrollment, inflation, pension income, significant health-related expenses, etc. From personal experience, I've found this topic to cause the most stress during reviews. Anyone claiming that reviews don't induce stress is misleading. In my opinion, it's not a matter of 'if', but 'how much', which varies from person to person.
5. Lifestyle Protection - Balancing Security and Affordability
Insurance is the most common way to protect your lifestyle, encompassing home and auto, life, long-term care, an umbrella policy, etc. Insurance requires a delicate balance. We don't want to be insurance poor, but we need sufficient coverage for life events that might impact our lifestyle. At Core Wealth Consultants, we don't sell insurance, so this will likely be a checklist discussion. Clients will have a task to contact their insurance agent.
6. Legacy - Securing Where and To Whom Your Things Go
In its simplest definition, legacy is ensuring that your assets reach the people or organizations you designate if something happens to you. While you'll need a lawyer for this, there are simple strategies we can suggest. The easiest are having beneficiaries on all accounts and ensuring they're up to date. If you haven't reviewed your legal documents recently, a takeaway is to meet with an attorney to update a Will or Trust, depending on your specific situation.
In summary, I've touched on the six common areas that we will cover when reviewing your financial situation over time, presented at a high level. It's easy to spend an hour or more on any of these areas. My goal was to provide some level of expectation and help you prepare properly. However, I want to stress that our interactions are more than just presentations or checklist discussions. They are about assisting you and your significant other in building a financially secure future through meaningful dialogue. And we have found this outline to be extremely helpful in doing so.
DISCLOSURE - All written content on this article is for information purposes only. We utilized ChatGPT and other sources for this article. Opinions expressed herein are solely those of Core Wealth Consultants. Material presented is believed to be from reliable sources, however, we make no representations as to its accuracy or completeness. Core Wealth Consultants, LLC a Registered Investment Advisor in the States of Florida, Indiana and Michigan. You should always consult an attorney or tax professional regarding your specific legal or tax situation. Diversification and asset allocation does not assure or guarantee better performance and cannot eliminate the risk of investment loss.