What retirement issue has hit you or your clients out of left field, and how did you resolve it?

Many investors were surprised by the magnitude of losses endured during the recent recession, and how it affected their overall financial security and retirement planning.

Between the downturn, higher unemployment rates, and rising health care costs, many baby boomers are also unexpectedly finding themselves slipping into the sandwich generation —needing to support both their children and aging parents, while trying to keep up with their own short-term financial obligations and retirement saving.

These individuals are turning to their financial advisors to have tough conversations about their personal values, financial priorities and lifestyle choices.

What prospecting methods have been most successful for you in attracting retirement-planning clients?

For over 25 years, our greatest source of new business has come from recommendations and referrals from our clients.

Do you face any frequently occurring retirement-planning mistakes with prospects?

We face quite a few of the same recurring mistakes, and the errors are often combined. Some people simply retire too early, with no clear plan or vision for how they’d like to spend their time in retirement. Additionally, they may not have saved enough money to fund the lifestyle they had hoped for in retirement.

In addition, unexpected events can cause a financial interruption. For instance, if wills and documents are not reviewed and kept up-to-date, families may face complex and sensitive issues for which they are not prepared. The key to avoiding these mistakes is discussing “what if” scenarios and testing the foundation of an investment strategy against possible disruptive events.

What challenges do you face when modeling clients’ retirement incomes and cash flows, and how do you resolve them?

The greatest challenge when modeling clients’ retirement incomes and cash flows is the management of both sides of the equation—how to make money, while also not losing money. This is a particularly delicate balance once in retirement. After all, the whole point of retiring is doing something “different,” whether that is a new form of employment or a lifestyle transition.

Generally speaking, in retirement, client goals include: (1) Protect my principal. (2) Maintain enough income to support my standard of living. (3) Grow my capital at least at pace with inflation (but not at the expense of goals 1 and 2). (4) Assist in arranging for an orderly and efficient transition of my assets to my heirs or other beneficiaries. These four guidelines help clients focus on what is most important to them, and avoid the distraction of unnecessary risks.

What mix of products and solutions do you use most often and why?

Our strategy has always been to keep things as straightforward and simple as possible. We focus on investments that are high quality, marketable, cost efficient and easy to understand. Each client’s asset allocation must be individually designed and driven by that client’s investment goals and risk tolerance.