Why Is It Important to Have Financial Management?

Sunday, January 15, 2017 – Wealth Strategy with Bryan Rigg Radio Show  – Every Sunday 1-2:00 on KLIF


Why is it important to have financial management in general?

In my opinion, from the research that I have been given throughout the years, 50 percent of all people who retire today have 50 percent less than what they need, not than what they want. It’s very important to think about. People today who are planning for retirement are not doing a good job of putting away what they will need to maintain their lifestyles. There’s a huge need in doing a proper financial planning and proper investing, in other words. That is something that we can do, obviously, and help people with doing that.

Also, there is a lot of research out there that people who try to do it on their own do not do it very well. They need help in devising a plan and getting them focused on the goals that they need to accomplish to help them in retirement. Having somebody who is a quarterback, so to speak, for your portfolio I think is critical. That is something that financial management brings to the table, helping people understand their goals, their options out there, and then to give them a compass heading. I think that is critical for a lot of people. Once they have a compass heading of where they need to get to, that is critical.


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Announcer:  Rigg Wealth Management offers securities through Broker Dealer Financial Services. Member, SIPC, and advisory services through Investment Advisors Corp., an SEC‑registered investment advisor. Rigg Wealth Management is not a subsidiary of Broker Dealer Financial Services. Neither Rigg Wealth Management nor Broker‑Dealer Financial Services offer legal advice. Clients should consult their attorney of choice on all legal matters.

Announcer:  Welcome to “Wealth Strategy with Brian Rigg,” heard every Sunday at one o’clock right here on KLIF. Brian is a celebrated Yale graduate, adding a PhD from Cambridge, a former officer in the Marine Corps, a man of profound integrity and honor and your wealth professor. Please welcome your host for the next hour, Mr. Bryan Rigg.

Segment 1

Bryan Rigg:  Good afternoon ladies and gentlemen. This is Bryan Mark Rigg with Rigg Wealth Management. Thanks for joining us again from last week.

I wanted to go over today some of the questions that we got from last week. Before I do so, I’d like to give a little bit of background on my person again and tell you who I am.

I was born in Arlington, Texas right down the road in 1971. I grew up here. I went to Yale University and did my undergraduate work there. I got the Henry Fellowship to conduct graduate studies at Cambridge University and went there and got my master’s and PhD.

I’ve written several books on World War II and the Holocaust. Over 10 years ago, I transitioned out of the academic world and went into Wall Street. I joined Credit Suisse at first and then I joined an independent firm which was very important in 2009. Also in those years, I was a Marine Corps officer, and that has played a huge role in the way I look at things and how I’ve been developing this business. My two partners are also brother Marines and served as military officers in the Marine Corps.

I think the important thing in getting back to where I am now with Rigg Wealth Management, the independence, and why that’s so important is that quite often people when they go to a wire house, they can’t always be sure that they are getting the right information that they need for their portfolios.

A lot of times, people working at the wire houses are given information that they are told to give to the clients. They do not have independent thought with that information. Being independent is a very important aspect of this industry for people who want to have financial management done for them because it gives them a more suitable selection of products that are out there.

We call it “open architecture” in our field. That allows us to go out, look at all the different products that are out there on the street, and bring the more suitable one to their portfolios to help our clients with their needs, and with their goals.

Why is it important to have financial management in general? In my opinion, from the research that I have been given throughout the years, 50 percent of all people who retire today have 50 percent less than what they need, not than what they want. It’s very important to think about.

People today who are planning for retirement are not doing a good job of putting away what they will need to maintain their lifestyles. There’s a huge need in doing a proper financial planning and proper investing, in other words. That is something that we can do, obviously, and help people with doing that.

Also, there is a lot of research out there that people who try to do it on their own do not do it very well. They need help in devising a plan and getting them focused on the goals that they need to accomplish to help them in retirement.

Having somebody who is a quarterback, so to speak, for your portfolio I think is critical. That is something that financial management brings to the table, helping people understand their goals, their options out there, and then to give them a compass heading. I think that is critical for a lot of people. Once they have a compass heading of where they need to get to, that is critical.

By way of illustration, I had a client recently telling me that when she retired she would need $60,000 a year in income. I started looking at her portfolio, and I said, “Do you realize that you’re going to need probably $1.3 to $1.5 million under management to be able to generate that type of cash flow per year and also keep you up with inflation and be able to put back into the portfolio?”

She had no idea that is how much that she would need. It seemed fairly overwhelming to her, in her 30s, thinking how much she would have to save by the time she was 60. When we broke it down and started showing her how much she would have to put away per year, it seemed more manageable to her.

We showed her a game plan for 30 years, and it would help her to work towards her goal of $60,000 in income coming in if she followed it. That gave her a lot of relief. The numbers, at first, were shocking to her, but once we started looking at it over the next three decades, then she saw it seemed more manageable.

This is just one example of why it’s so critical to do financial management. Also, why being an independent financial planning firm, here at Rigg Wealth Management, is conducive to finding flexible solutions for people’s portfolios. This is critical. In my opinion, to be able to adapt and improvise along the way, to help your clients is critical. Having an independent financial firm can help you in that arena.

Also, a core component of financial management is making sure you get your overall estate in order. Even though we don’t benefit from helping people get proper legal advice, one important byproduct of doing financial management is helping to connect people to the right legal professional, to make sure they get their estates, their homes, and their families taken care of in the future for anything that could possibly happen.

One big focus that we have here at Rigg Wealth Management is making sure people have their power of attorneys, their healthcare surrogates, their wills, their trust, and other legal documents in order. Quite often, when you touch a person’s pocketbook, you touch their soul, and you start figuring out exactly what’s important to them. Quite often, that’s going to be family, their health, and how they’re being taken care of. It’s very important to do this.

By way of illustration, we gave this example last week, but it’s worth reiterating how important it is to do estate planning. I had a client who came to me. She had just gone through a divorce. She had a liquidity event with this divorce, had a lot of cash coming in.

She had three children that she was taking care of. She was very focused on making sure that, if this money were to go to her children, in case of her death, that it would be taken care of in a responsible manner. She wanted it to be controlled and put into a proper trust to take care of them health‑wise or with their educations.

Working with her attorney of choice, we got all her estate planning taken care of. We got her portfolios up and running and invested. Sure enough, several months after we got all her legal documents exercised, she unfortunately passed away.

We had everything put into play immediately on her death, and it’s has been able to take care of her children. If she hadn’t done that, there was a chance it would have been several months of it being locked up in probate. The funds would have probably just been distributed in one lump sum to each one of the three children, and there wouldn’t have been any focus on taking care of their educations and their health.

Now, several years after this, we have seen that this plan of hers has worked very well. It’s helping her kids get educated. One has already finished their education. It’s helping the kids with their medical needs. Her goals were implemented after her death, of taking care of her kids in this way, and having those estate documents were critical of achieving those goals of hers.

As Shakespeare says, every man owes God a death, and planning for that is very important. One thing we hope we do here at Rigg Wealth Management is making that planning realistic and in putting people in a better place, psychologically, of realizing how this can help their overall family, their overall world, by doing this. A lot of people don’t like to do estate planning, because obviously they’re dealing with their mortality.

I think one key component of financial planning that needs to always be focused on is making sure that your estate situation is taken care of. Once that’s taken care of, that gives you a blue print of what you’re going to be doing with your own life. How are you going to take care of your retirement? What your goals are for retirement, and so on.

This leads me to one subject matter that a lot of people have talked to me about. That is, their 401(k)s. Nowadays, a lot of the retirement responsibility is put on the shoulders of the clients themselves.

One thing at Rigg Wealth Management that I hope we can help people with, even though we usually don’t benefit a lot financially from this, is helping people put together a good plan for their 401(k) that they are participating in. We can guide them on the 401(k) options available to them, and this will help them achieve their retirement goals.

Now, a lot of the companies have put the burden of the responsibility of putting their retirement in play on the shoulders of the actual employees, instead of the companies doing it themselves. Something else that I think is very important as people start looking at their portfolios and their retirement goals is to start helping themselves by getting educated about what they can do, and how they should do things in order to achieve their goals.

Again, it’s great to have you all back here listening to this program. We encourage you to visit our website at riggwealthmanagement.com. Our telephone number is 972‑383‑1210, encourage you to call and set up a meeting if you are interested in exploring a lot of the ideas that we just went over.

Bryan:  We will be back in a few minutes. Please stay tuned. We’ll be talking about some of the questions we got last week, and the answers to them we’ll explore.

Segment 2

Bryan:  Welcome back, ladies and gentlemen, with Rigg Wealth Management. As I discussed earlier, we’re going to go over some of the questions that we got last week, give you hopefully some answers, and give you some food for thought.

One of the questions we often get is, “How often should you be meeting with your financial advisor?”

If you haven’t ever done portfolio management and put together a plan for your strategy to pursue your goals by retirement, you probably want to meet with your financial advisor several times at the beginning. Make sure that your portfolio is property explained. Make sure that your goals are very clear. Make sure there’s no misunderstanding.

Quite often, I have found that when I sit down with clients, especially when I first started out on Wall Street, and explained a lot of things to them ‑‑ this is my fault, by the way ‑‑ many times I thought that they understood what I was saying. I should have followed up with a lot of questions to make sure they were understanding what I was saying.

A lot of times, clients are embarrassed to ask further questions if they are confused by something. They’re hesitant to actually ask you what an acronym means or what a concept means. They’ll just nod along with you, thinking that everything is going to be OK and that they understand the basic gist of what you’re telling them.

One, two, three, or four months later, when there’s a lot of volatility or when maybe the cash flow isn’t what they thought, they will be expressing surprise. I encourage all people who are engaged with financial advisors to not be shy and to ask for clarification, especially of terms. Do not be hesitant about going over the way that you understood how the portfolio is set up, so there is no misunderstanding later on.

On the other side of the equation, as a financial advisor, I think I’ve done a better job than others throughout the years of sitting down with clients and going over concepts, looking at techniques that they were using beforehand, and looking at how we could potentially improve upon those and benefit the client going forward, to achieve the goals.

In other words, I would encourage people to be proactive in getting educated about your portfolios. Learn about the strategies and have an active engagement with your financial advisor about what you are doing. Here again, do not be shy about asking him or her questions about the portfolio.

How often should you meet? I would say that is his or her job, the financial planner’s job, to meet with you as much as you need, especially at the beginning, to make sure you’re very comfortable.

Also, the one thing that I’ve found, and maybe this is my background of being a professor at American Military University and SMU, I’m very big about education. I’m very big about reading.

One thing I find a lot of my clients do not do is they do not want to know really about the financial markets, about stocks and bonds, about management in general. I get it. In our lives today, we’ve got so many things pulling us in different directions. It is very hard to give some focus on financial management and portfolio analysis and so on, and these are not the most exciting topics in life. This is something that I think people need to do a better job of educating themselves about.

If you were to come and work with us at “Rigg Wealth Management,” the one thing that I really like to do with my clients is give them some books to read so we can sit down and discuss them. This helps with the educational component of it. It also helps with the feeling of being a partner. I think it’s very important as a financial planner that you build out a good rapport with your clients and try to develop a partnership where there is a give and take of ideas and exploration. And as a teacher, as a former professor, I’m very big on that.

You should meet with your with your financial adviser, not only to go over your portfolio but also to get educated. Most clients do not get educated in this process. A lot of times when they move from one adviser to another it’s just because they got upset or there’s miscommunication or whatnot, but they didn’t really take the opportunity to get educated on things, read up on how portfolios should be structured and how they should be achieving their goals.

Getting back to the question, how much did you meet several times. Maybe that’s once or twice a month. Then once you start getting a sense of comfort, usually, there’s not a reason to meet except for maybe on a quarterly basis or a semi‑annual basis, unless you’re getting closer to retirement and you’re doing a little bit more planning as far as what’s going to be the cash flow on a monthly basis.

In general, once you get the portfolio operating on all eight cylinders, so to speak, and then you can sit back and rely upon your financial adviser to let you know if there’s a need to meet, a need to go over maybe some tweaks that you need to make on the portfolio.

How often should you meet? There’s no blueprint on that, but I would strongly encourage people who get on with a new adviser to meet more often than they think at the beginning and with a focus of being better educated about what is going on with their portfolio. I think that is critical. Education is critical. Most people do not do a good job of getting educated about their portfolios.

I know when people started thinking that I sound brilliant and know exactly what I’m talking about, that they definitely get help. Because I am usually talking about things in a very elementary way, things that they should know but our educational system does a poor job of really teaching people to take care of their finances and the money that they earn.

The second question that we often get from a lot of people is they want to ask, what does active management actually mean? That’s something that we do an awful lot at Rigg Wealth Management. Nobody has a crystal ball about the market, but we do know there are different sectors every year that may experience better results.

If you have a broad diversification within your portfolio, you can take advantage of this. The way that we view active management, and we think this helps our clients, is that if you have a portfolio of 20 different holdings in different sectors in the market and five or six of them are up well above their averages, then that’s where you want to consider selling those off. Then you look at the other areas that are and consider whether or not they are a good addition to your portfolio. A lot of people have heard the story of buy low, sell high.

What you want to do is you want to implement that strategy by looking at your portfolio, seeing what it’s telling you, and then respond to it. You’re not going to be able to buy something very low at the get go a lot of times. You’ve got to be watching the market and give your portfolio time. When you see an opportunity, you then want to respond to it. The active management helps us look at the portfolio of several different holdings. Every quarter, every half a year, every year.

We look at things that have gone way up and then things that have gone way down. We sell off those profits off the things that have gone up, and then we buy areas that have gone down. According to some research that we have, this process helps you in the long run get a better return in the overall market. A lot of times, if you were just to leave your holdings alone, you might get‑let’s say‑around an average of five percent.

If you were to do active management, the research seems to tell us that a five percent return could then be turned in the long run over several years into like a 6.3 percent return on the overall portfolio. This is where the active management in the long run typically helps out a client more so than inactive management.

Then you must do something else with the active management. You’ve heard the phrase don’t put all your eggs in one basket. Having this diversification allows you to not put all your eggs in one basket. Then you watch it very carefully, and that’s when you start taking advantage of things when they go up and things when they go down. That is critical.

Getting back to the first question, how much do you meet with your adviser? You should meet with the adviser as much as you can until you understand what their philosophy is. One of the big philosophies here at Rigg Wealth Management is active management is critical.

The last question that we’ve got is about estate planning and things that you need to be looking at. We talked a little bit about that earlier.

It’s important I think that everyone have a power of attorney, so if something happens to them that somebody can come in and take care of their bills. A lot of people don’t know what a power of attorney is. Very important to have a power of attorney. Also think about a living will. If you get sick and you’re brain dead and you don’t want to continue on living, somebody has to have a living will to make sure they can pull that plug so you’re not a burden on anyone.

Health care surrogate. Let’s say you are healthy, you’re in a coma, there’s a chance for getting well again. You want somebody to come in and be able to make good medical decisions for you. Then, obviously, having a will. You want to have a good focus on where you want items to go, jewelry that you’ve inherited, or jewelry that you have, stamps, coins, cars, this is very important. A will will direct people after your death of what you want and your desires.

Those are some of the questions that we got from last week. Hopefully, this has provided you some food for thought to go over with your financial advisers and your attorney or legal advisers.

In the next segment that we will be having today, we’ll be talking about the current political environment and what that actually means for your portfolio and what we can be looking forward to seeing possibly play out on the historical stage as well here locally with all the interesting things that have been going on politically.

Please feel free to visit our website, riggwealthmanagement.com. Or please feel free to call us at 972‑383‑1210. Thank you so much for tuning in to Rigg Wealth Management and we’ll be talking to you here shortly.

Segment 3

Bryan:  Welcome back, ladies and gentlemen, to the show. You’re with Rigg Wealth Management. Questions that we’ve been getting recently, a lot of people worried about what’s going on politically, what’s going on in the world, and what does history tell us about what we’re going to be seeing. The inauguration is going to be happening here in a week and a lot of people are very nervous, both sides of the aisle.

Many are extremely nervous about where our country was going, and that’s why they voted for President Trump. Many also now that Trump has gotten elected are extremely nervous about where the country is going to go. The one thing that I want to encourage people to think about historically is that even with all the uncertainty in the air, I believe we are in a very good place as a country. Many need to realize that perspective is the cornerstone of education and in seeing where we’ve come from.

We’re not going through a revolution, cutting ourselves off from Great Britain and going through a major war that split families apart. We’re not having a war like in 1812 where we have an invading force that marches down on our capitol and burns our White House. We don’t have a horrific situation where we saw with the civil war where families were once again ripped apart and our whole nation was fighting each other, and it was uncertain whether the union would be preserved.

Of course, I could go even further and look at World War II and when the dark clouds of Hirohito’s Japan and Hitler’s Germany were covering most of the Earth and it was uncertain whether fascism and dictatorships were going to rule or not.

We are in a pretty good place right now. Obviously, we have problems with North Korea, we have problems with the Middle East and Islamic radicals running around and killing people. We’re always going to have these issues. They’re enduring issues of humanity.

But the good news is that America is in a very strong place, and we have a very strong military. We have a political system that is working, although many people think it’s not as good as it should be, but it is working. We have checks and balances.

I want to encourage people that when you look at history, you must realize just how good we do have it. The most important thing to be focusing on from a financial management point of view is, with all this white noise that’s out there, it’s very important to keep focused on your goals. Keep focused on your portfolio and how you can build out your resources so you’re not a burden to anybody else later, and that you continue to work toward fulfilling the goals that you want in the future.

To discuss this in a more thorough way, I’ve brought on my business partner, Gary Bilyeu. I’m very honored to have him on my shoulder. He is still in the Marine Corps Reserves. He’s a Lieutenant Colonel, combat veteran. He’s had over 10 years experience in the insurance world and we’ve been working together for a couple of years. We’ve both been discussing a lot about how it’s important it is for people to look at retirement.

We’re going to be going into 401(k)s here, but this also is for traditional IRAs, for SEPs, simplified employment pension plans that people can do who are self‑employed. There’s a lot of ways to put away for retirement. Right now, we’ll focus on one particular way that many people, especially if they’re employees have to focus on.

Gary, you shared some thoughts in the break. I’ll turn it over to you and see if you have any thoughts or any questions that you want to discuss.

Gary Bilyeu:  I appreciate that, Bryan. I appreciate you having me back on the program. We were talking about this and most people out there, especially those that are working, have some type of employer sponsored retirement plan. We try to break that down. We try to keep things as simple as possible here at Rigg Wealth Management.

Da Vinci said that simplicity is the ultimate sophistication. Of course, my dad said KISS, keep it simple, stupid. Whichever one of those that you subscribe to, we try to tailor that to each one of the clients. When we talk about employee sponsored retirement plans, I think it’s important to just start at the basic level, the difference between a defined benefit and a defined contribution.

Bryan:  Yeah, go ahead.

Gary:  As you well know, our parents, when they joined the work force, they were primarily under the defined benefit plan, many of them referred to them as pensions. I’m sure many of our listeners have heard of those. That was where the responsibility was on the employer to make the financial decisions.

The employee simply went to work, and if they worked there 20 years they received a defined benefit. If they worked 25 years, that benefit was greater and so on and so on.

There was the shift, as you’re well aware of, to a defined contribution plan. You and I have discussed the reasons behind it and the history behind it, but most employees today fall under the defined contribution plan.

We know those as 401(k) or a 403(b) or a 457 plan, so on and so forth. What that means to the employee is now that burden for financial decisions has shifted from your employer to you as the employee. To kind of go back to last week’s show, the importance of a financial adviser, that’s where we come in. Hard working people focus on their job and providing for their family, but now they have the burden of making financial decisions, investment decisions for their retirement. They have their experience in whatever field they’re in.

We so happened to have our experience in the financial management and financial advising realm. That’s where we can come in and help them with those decisions. We often find that people who are involved with a 401(k), a lot of times, they’re just in the default mode of the plan. Definitely, the default mode may not be in line often with the person’s age and goals.

Bryan:  That just off the bat, if somebody were to come to us and wanted to work with us and all they had was a 401(k), we’ll be more than happy to advise them and help them ascertain what is the best compass heading for them from an age perspective as well as from a risk perspective. That’s the role of a financial adviser, and that is to also educate the person about what options they have in that plan.

One thing I want to put in here before Gary jumps back in is what’s important to really remember is that when you’re in a 401(k) plan, you want to make sure you know what the match is of the company you’re working for.

Gary:  We have clients that we talk to early on. They may be young, starting out. That’s their first goal. Over time, as their incomes grow and they want to learn more about their retirement and financial planning, then that’s when we come on board. You know as well as I do we have clients that we’ve been talking to for many, many years and only recently become clients.

One of the things that we do at Rigg Wealth Management is we provide financial advice for people who want to protect and grow their money. We try to make people comfortable with their financial decisions.

Bryan:  On that note, part of that to feel comfortable with your decisions is here again education. One thing I want people to take away from this segment, and I mentioned it earlier, but I can’t emphasize it enough is that when you’re looking at retirement, remember that the data that’s being presented to us today is that 50 percent of all people who retire today have 50 percent less than what they need, not than what they want, what they need.

A lot of times, the company will match up two, three, sometimes a little bit more percent of what you contribute. That’s what I call free money. You definitely want to do up to the match minimum in your 401(k). Gary?

Gary:  I think that’s a good point, Bryan. With my clients, one of the first questions I ask them is what are they putting away now. Do they have a 401(k)? If the answer is yes, the follow up question is, are you maxing out that contribution. I tell all my clients, just like you described, it’s for money. I recommend they max out their employer matching, and then if they have additional money that they want to invest for their future, then we can talk about that additional money. I always encourage them, max out your employer contribution first.

Bryan:  If you don’t know what that is, ask the accounting office of your firm.

Gary:  One of the things that we do at Rigg Wealth Management is we provide financial advice for people with goals of protecting and growing their money.

Bryan:  Good point, Gary. One thing I didn’t mention earlier with this concept that Gary just mentioned is that quite often when people have done analysis of those who are struggling now in retirement, they have found that had proper financial planning been implemented from the get go, a lot of the problems that they are having now in retirement could have potentially been alleviated. In other words, a lot of their goals could have been met and they would have had what they need in retirement if proper financial management was done from the beginning of working with the retirement plans.

Gary:  Yeah. Bryan, I think you probably come across as many people as I do that may not admit it but their strategy is a buy and hope. They’re investing. They’re buying investments, and they’re hoping they appreciate over time. We don’t subscribe to that strategy. We will sit down and customize a strategy built for them.

I invest for my retirement and my family a certain way, with all of the suitability standards that we would ask the clients. My risk tolerance, my time horizon, and so on and so forth. You do the same, but that doesn’t mean that we have identical investments. That’s where we sit down with the client and find out what their goals are, what their time horizon is, what their risk tolerance is.

Of course, there are still no guarantees, but having a customized portfolio in place can help put someone in a better position going forward. That’s what we do. We customize a portfolio for them.

Bryan:  Yes, I agree with you, Gary. One thing that you said earlier about doubling all their money is when you do that match with a 401(k), people need to remember that. History can help be a guide. That’s one way that you can look at the investments that you have at your disposal in your 401(k).

I do like what Mark Twain says. He says, “History may not repeat itself, but it definitely rhymes.” Using historical data, it’s very important to look at how you can set up a portfolio and manage expectations, understanding that the past performance does not guarantee necessarily future results.

One thing that different portfolios have shown us is that if you have a good diversification plan and you have a good plan on how to rebalance and do active management, as mentioned earlier, this is going to help you accomplish your goals. This is what you need to do when you’re looking at your 401(k).

Gary:  I think that’s a good point. We say hope. As we just stated, buying hope is not a strategy, but when we sit down, people out there are investing but they’re investing their time in their families, their jobs, everyday life. They simply have money coming out of their paychecks and they’re hoping that that will grow. That is what we do. It’s our job to focus on their investments. We focus on working to meet their individual goals, while they can have the comfort level to focus on their family and their interests.

Bryan:  Yes. Thank you so much, Gary, for being here. We have one more segment and it will be coming up here soon. Please stay with us. We encourage you again to look at our web page, Rigg Wealth Management. Also if you like to come in and talk about your portfolios and look at financial management options out there for you, please feel free to call us to set up an appointment. 972‑383‑1210. We’ll be back here momentarily.

Our show is always on KLIF every Sunday from 1:00 to 2:00. Appreciate you listening in and we’ll be back with you shortly.

Segment 4

Bryan:  Welcome back, ladies and gentlemen, with Rigg Wealth Management. I’m Bryan Rigg. In this segment we’ll be talking about once again what we can do for you here at Rigg Wealth Management, then some of the questions that you might be thinking about asking your financial adviser, what you need to be asking yourself in your effort to achieve your financial goals.

At Rigg Wealth Management, we’re an independent advisory firm. We’re not beholden to any required list of products. We’re able with full independence of looking at what all other firms are doing, and then finding a more suitable investment, if you will, for your portfolios with different financial instruments.

I think that’s very important to reiterate. If you’re looking at some of the questions, you need to be asking yourself and others when you’re looking at a financial adviser. I am a little biased. I do believe independent financial advisers do a better job of taking care of their clients because they’re not looking to the firm’s interests, and looking to feed the heavy chain of command that’s not interested in them or their clients.

They’re not forced to meet quotas, trying to make certain benchmarks of how much money they’re earning for the office. Being independent means that you have none of those pressures. You can really focus on the client and make sure his or her needs are met with a plethora of financial instruments.

Getting to some of the questions that you need to be asking, we’ve talked an awful lot about retirement. People think of retirement in very simplified terms of just that’s when I’m going to stop working full time. A lot of times when we talk about retirement here at Rigg Wealth Management, and hopefully most financial advisers when they talk about it, they’re looking at how much money you need to maintain a certain lifestyle. Looking at that is very important.

I cannot reiterate that enough for the listeners to be thinking really hard about what do you need to maintain your lifestyle once you do stop working. When is that date going to be? When do you want to stop working? Then develop a plan to get there.

Here again to go back to an analogy, that case study that we gave earlier of a woman who wanted to have $60,000 in cash flow coming in when she retires. One needs to put into the back of their mind right now that in order to do that, you’re going to need well over $1 million to be able to generate that in retirement.

Planning right now, those of you who are in your 30s and 40s, is critical to make sure that you achieve those goals when most people do retire, which are in their mid 60s, late 60s, early 70s. The questions you need to be asking is, what are you spending money on now that you don’t need to, how much are you putting away, how educated are you if you are an employee of a company about their 401(k). Options, are you doing the match? These are questions that are very important to look at.

Quite often, I think humans in general, they declare a crisis and then they start to prepare for it. With retirement, that’s not a good strategy. You don’t want to have retirement and then start planning for it. I had a professor at Yale one time telling me that a lot of times the problem with America with our wars is that quite often we declare a war and then we start preparing for it. A lot of military historians say the problem with a lot of militaries is they fight the last war. Bringing it back down to retirement, you don’t want to be hearing a lot of times, like I just told you in the last segment, that 50 percent of all people who retire today have 50 percent less than they need.

You don’t want to have that same situation and then have to reverse engineer your life, so to speak, to meet up or meet down to the level that you’re able to support. You want to make sure that your standard of living and your lifestyle is not impeded by you retiring. We’re finding a lot of people are having to work longer than what they thought because they hadn’t prepared and they don’t want to work any longer.

Here at Rigg Wealth Management, we have to give people the tools to be able to design the portfolio in such a way that hopefully they have more than what they need, so there’s more calmness going into retirement. There’s not this sense of urgency of trying to work a couple extra years just to make sure they can pay the bills and take care of themselves. I think that’s very important to look at as far as financial management.

Another thing I like to encourage is not necessarily part of financial management, but I think it also is part and parcel of the solution to making sure you meet your retirement goals is also just looking at your overall lifestyle. Are you setting up proper goals of taking care of your health, eating well, estate planning, and things of that sort? That’s going to allow you to enjoy retirement.

What are the things you want to do in retirement? A lot of people want to stay active. A lot of times people want to travel. If you’re not taking care of yourself, exercising, making sure you’re laying a good foundation to enjoy your financial resources later on, then what’s the point of retiring with a lot of money when you don’t have your health?

These are other types of things I think that is important to look at. Ask yourself as you’re going forward in retirement, what are you doing to make sure that you are taking care of yourself not only financially but health wise and so on, because that’s all part and parcel.

Also part of retirement is looking at healthcare, your medical needs, and things of that sort. These are important questions to look at as well. How are you taking care of your medical responsibilities, making sure you got proper insurance?

Gary who was on earlier, he’s very good at looking at those options and helping clients with that. That’s something we can look at as well, health insurance, making sure people got the right type of coverage.

Of course, that has a very fluid environment, and so that’s something else at Rigg Wealth Management that we can continue to stay on top of things and give people advice and education about how they need to be looking at that part of their life.

Other questions that need to be asked is, how they’re saving and how much money are they deploying into their portfolios. Quite often, I’ve had clients that I’ve worked with for a long time and then I find out that they’ve been holding back a lot of cash, because they’re just kind of worried about what’s going to happen. They want to have that security of having a very fat bank account.

But one thing to keep in mind is that if you don’t have your money working, especially with the interest rates that we have today, near zero, that every year your money doesn’t work for you, looking at inflation rates, is actually decreasing in purchasing power by around 3 percent.

The Consumer Price Index that measures inflation is around 2.8, 3 percent right now. If your money is not getting above that, or has the potential to get above that, your money is getting weaker and weaker every year.

I think this is also a very important thing to look at with your cash, important question is how are you keeping up with inflation? How are you making sure that your money’s working for you and keeping its purchasing power?

I think other questions that are important to ask is, where do you want to live? What type of place do you want to live later on? A lot of times, part of retirement planning is looking at making that transition to long term care facilities, retirement homes. There’s insurance that can help you out in that area as well.

There’s a lot of planning that goes involved, especially for listeners who don’t have children who necessarily can come in and help them out. I think financial planning right now to make sure that they’re taken care of later on is extremely important. And even those with children, you don’t want to be a burden on your kids later on. If you have a good retirement plan financially to help you when you move out of your home, or out of your townhouse, or out of your apartment and go out to your retirement facility, that is something that is important.

Some believe they will need some type of longterm care facility later on in life. That’s part of the financial planning that is very important, as well.

These are a few of the questions that we like to go over at Rigg Wealth Management. There obviously are hundreds and hundreds of more questions that we can go over.

If you are interested in exploring on some of these questions, and looking at your portfolio and seeing what we can do for you, please feel free to call us at 972‑383‑1210. Also feel free to visit our web page at riggwealthmanagement.com.

We’d love to hear your feedback from the web page. Please come back and listen to our show next week Sunday, 1:00 to 2:00, on KLIF. We will be conducting this show in the future every Sunday at 1:00 to 2:00, and we hope you continue to join us. Thank you so much for listening in today.