If you’re in the FRS Retirement System, do you really need a financial advisor to have a successful retirement? Weird, right? Here I am, a wealth manager and financial planner, telling you, “Hey, maybe you don’t need an advisor.” And it’s true—there’s a good chance you don’t. But for some of you, I think it could be the difference between success and total failure. Let’s get into it.

We’ve been working with FRS Special Risk participants for nearly 20 years. We’ve helped hundreds of firefighters, police officers, and corrections people, and have found that for a lot of them, all they really needed was just a little guidance and assurance and that’s about it. The simplicity of their basic plan—maybe it includes a reasonable pension each month, some DROP and Deferred Comp money—the simplicity and elegance of the FRS Pension plan for a good lot of you really just calls for a determination around “Is it going to be enough?”

We’ve helped more FRS special risk folks than I can count with that question, and we continue to do so. And then we send them on their way, in most cases with the confirmation they needed to proceed on their own.

But some of you DO need more help than that, and things do get a little more complicated where it’s worth it to work with someone. Like those in the Investment Plan, or those that might have considerable DROP or Deferred Comp amounts. Or maybe for some of you, finances and investing and financial planning just isn’t your thing … like, you’d rather have a root canal. And that’s all right. But how do you know, and how do you find out if an advisor is right for you without feeling like you have to subject yourself to someone’s sales pitch to try and get you to buy whatever financial product they’re selling or to come aboard as a client?

And what kind of things should that person be helping you with? What should you expect out of them? When we get asked that question—“What can you help us with, and how do you do it?”—this is how I answer: with a simple formula.

First off, Wealth Management equals Investment Consulting. That’s the first part, and it’s answering the question, “Am I making smart decisions with my money?” It’s focusing on making sure your investments like your IP, DROP, and Deferred Comp are delivering what they should be, looking at how they are globally allocated and invested, and that you’re not paying more than you should in fees and taxes. And most importantly, it’s about having an investment strategy and investment policy that is evidence-based with a high probability of helping you achieve your most important goals.

Now, to us, all of that is just table stakes—the bare minimum of what a wealth manager should be doing. And some advisors are clearly better at it than others. But here’s the thing. According to studies done by CEG Worldwide, less than 7% of advisors who call themselves Wealth Managers do anything more than that or proactively take their clients on to the next level—the next set of questions that you’re going to ask and need answers to. We’ll group these next questions into Advanced Planning, which is the second part of the Wealth Management formula.

The next question our clients typically need answers to will have something to do with cash flows or how do they get more out of what they have. These are Wealth Enhancement concerns, and they have to do with things like reducing debt costs, mitigating taxes, and increasing cash flows in retirement. It’s about making better decisions so you can keep more of what you have and do more with it.

After that, our concerns revolve around Wealth Transfer issues. Where’s your wealth going to go, and how’s it going to get there? Do you have the right documents in place should something happen to you? What do all those different documents do, like wills, revocable trusts, durable powers of attorney, and health care durable powers? Do you need them? Do you need them all? How do you get them? We make sure our clients have this covered and that it all keeps up with the changes that undoubtedly will occur in their lives going forward.

Another concern that needs attention is Wealth Protection. Where’s the risk in your life that could negatively impact your wealth, and can we mitigate that risk away? Do you have investments, like real estate, for example, that if a rental tenant were to sue you would potentially open up your other assets to a creditor claim? Are there other areas in your life where a lawsuit might occur, and what can you do to protect your wealth for your family in the event of a lawsuit? Or what if you or your spouse has a long-term care event? Can your financial plan survive that? Looking for risk and analyzing its effect on you and your family is an important part of retirement planning that needs to be looked at.

And finally, while it may not be on everyone’s radar, Charitable Planning is important for some people. Perhaps there’s a charitable organization out there that’s meaningful to them, and they’d like to give away some of their wealth to help them while at the same time helping their own wealth enhancement or wealth transfer concerns.

Which brings us to the last part of our formula: Relationship Management. We’ve found this to be the glue that holds it all together. And there’s two parts to this. First, there’s the relationship between the wealth manager and the client, and there needs to be a process in place that will continue to address all these questions and concerns because, well, life changes, and so will the answers to these questions. Second, there’s the professional network team we all tend to have around us—the professionals we need to complete these concerns, like your accountant for your taxes, your attorney for your estate documents, your insurance professional, and maybe one or two other folks you depend on for advice. Who’s coordinating them? This is where a good wealth manager can really make a difference, keeping everyone on the same track … your track.

If you’d like to know more about how our highly defined process works here at Northstar Financial Planners, I invite you to give us a call. There’s no obligation, and I think you’ll find that you’ll be happy you reached out. Thanks for reading and stay safe.