In a Digital World, Face to Face is Still the Lifeblood of the Retirement Planning Game

November 17, 2017

Online business is booming and nowhere is this more apparent than in the retirement planning and insurance worlds. “Robo advisors”—computer programs whose scope includes portfolio planning, asset allocation, and risk tolerance assessment, among other tools—are the next big thing in the finance world and standalone tools like online investment calculators are seeing increased use. Still, when it comes to doing business with the baby boomer generation and, particularly delicate financial business, the face-to-face interaction prevails.

“People still like the personal touch, especially when it comes to their money. They want to see you, touch you, talk to you and know that you’re real and you have their best interest at heart,” says Phil Goldstein, a principal of 1st Financial Investments located in Clarks Summit, PA. The firm, which Goldstein runs with his son Heath and his partner Michael Dillon, specializes in educational workshops for seniors that span a variety of topics from Retirement planning and Social Security Maximization to Long Term Care planning. This unique approach allows them to educate more people with more information at one time. He encourages other financial advisors to take this or a similar approach to have the opportunity to work with more interested people. “Workshops in general are a great idea because you can get your message out and potentially help more people meet their goals,” Goldstein notes.

In-person marketing efforts also allow financial advisors to keep their material fresh and take new and developing information into account as they assist their clients in making important financial and life decisions. New Department of Labor regulations, for example, as well as changes in the rules governing insurance and Medicare can make a big difference in the way people save for retirement and elderhood. Goldstein cites, for instance, a new regulation allowing individuals to withdraw tax-free from newer life insurance policies to cover long-term care expenses, should they have the need for Long-term care. For some individuals, this may mean they no longer need separate long-term care insurance, which may eliminate one premium from their already stretched budget.

With so many moving parts to the retirement planning equation—insurance, investment, saving, and distribution, among them—sound financial advice is key. What are some of those tidbits of advice? “Managing risk is really important,” Goldstein warns. “It’s best to go with programs that protect the principal to the extent possible, while still providing a reasonable return on the clients’ investment. Some even provide insurance on the principal which makes it virtually impossible to lose money.”  When it comes to the stock market the rule is simple: what goes up must come down. Fluctuations are a given, nothing stays up or down forever so insulating principal to the extent possible is a very smart way of planning for the worst.

Holistic advice can also make a positive difference to retirement planning precisely because of all the various considerations. Goldstein notes that in the process of retirement planning people need tax advice, insurance advice, advice about investments, and social security advice, among others. Having to go to a CPA, an insurance agent, a broker, and a social security specialist separately would undoubtedly cost more in time and money than getting all of these services and information from the same firm. “Time truly is money in this case,” Goldstein quips, “And not only does it save those things, but you really get better advice from a team working together so that they can take all of your individual needs and preferences into account across the full spectrum,” he adds.

While robo advisors and other computer-based tools can be incredibly useful, they can’t replace the human touch and a recent Forbes magazine article noted that a combination of the two—technology and good, old-fashioned human interaction—is most people’s preference. Whichever route one chooses, the key is advice, planning, and taking actions that have the desired outcome: providing a comfortable cushion that will sustain them through retirement. “At the end of the day, people don’t want to outlive their money, so the goal is to have enough to last” says Goldstein. “However they get to their goal, the point is to get there! The first step can be as simple as attending an educational workshop to learn what they need to know and to begin their journey.” 

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