Money Panel
with Chris Murray, Catharine Fairley, Brad Young and Shabri Moore
Have a financial question? Ask the experts. Send your question to business@newspost.com
My husband and I are in our 50s and he’s been doing our financial investments over the years. I’m thinking we should have a professional review our portfolio as we head into retirement. When we meet with our professional, what are some key points to bear in mind?
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RESPONSES:
CATHARINE FAIRLEY (Contact: 301-694-7411)
Your financial professional must be able to understand your investment knowledge and financial situation, your goals, risk tolerance and investment time horizon in order to make prudent recommendations for you to consider. You must be able to understand how your financial professional is compensated and what limitations there are to the investment choices offered. After receiving a recommendation, you should be able to understand each type of vehicle, associated fees and risks. You should also understand how the portfolio recommended for today (i.e., the next few years) will move to the recommended portfolio at retirement.
SHABRI MOORE (Contact: 301-631-1207)
The choice to work with a Certified Financial Planner may be one of the most important decisions that you make for yourself and your family. You may choose to work with your planner to address specific concerns or goals, to obtain a second opinion on your current strategy or for guidance over your lifetime. Choosing the right person to work with is critical. One excellent tool to use is the Financial Planning Resource Kit that you can obtain for free at the Certified Financial Planner website, www.cfp.net/learn /requestkit.asp. The kit includes brochures to help you understand more about the financial planning process, your rights as a financial planning client and 10 questions you should ask a potential financial planner. You will also find a link on this website that will give the contact information for CFPs in good standing with offices in your area.
BRAD YOUNG (Contact: 301-663-5454)
When you meet with a financial professional, the better prepared you are the better the more productive the meeting will be. Make sure you have the latest copies of all your non-qualified investment accounts, IRAs, Roth IRAs, 401(k), 403(b), thrift savings plans and any other investment accounts that you may own. Bring copies of the declaration pages from any insurance policies that you own, including life, health, disability, liability, homeowners, car and long-term care. If you have wills or other estate planning legal documents in place, bring copies of those. If you work for a company that has a pension plan, bring an estimate of what and when you will receive your benefit. Bring copies of your Social Security estimates that you should receive a copy of each year around your birthday. I would also bring a copy of your last tax return. It would also be good to prepare a budget of what you spend per month and discuss with your spouse what you think you will need in retirement. The biggest thing that you want to do is discuss with your spouse what the objective of meeting with the planner will be. This will help the planner focus on what your goals are and will take less time and make it a more productive meeting for you! Also, make sure that you are going to someone who is qualified to help you. There’s nothing worse than you spending all that time gathering information and taking it to someone who doesn’t have the qualifications to help you.
CHRIS MURRAY (Contact: 301-682-9876)
First off, let me say Happy New Year to everyone since this is my first Money Panel column in 2009. I think it is a very good idea to get a second opinion on your portfolio. Talk to someone who is objective, and is focused on your current situation and how it might be improved. Remember, you could be looking at being an investor for 30-plus more years since you’re only middleaged in today’s world. So be sure your investment and financial plans have the staying power to perform over decades and not just get you through 2009. When you talk to the adviser, ask common-sense questions, such as: 1. How long they have been in the investment profession (if less than 10 years ask what they did before, why they changed jobs and how previous experience is relevant). 2. Ask them how well they do their job, run their business, and request references from them. Having said that, only ask for references if you are seriously considering their professional services. 3. Ask them about their education and accomplishments in their profession. 4. Find out who they work for. Will the adviser be able to represent all of your interest and get any product or service you may need, or are they restrained by selling agreements and other conflicts of interest by the broker/dealer they work with. 5. Most importantly, make sure you work with someone who sees you as a client and not a number in their book of business — there’s a huge difference. Wishing you all the best in 2009!
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