The conventional wisdom on how to invest for retirement usually defaults to a few lowest common denominator suggestions. Often, those suggestions fail to meet the needs of investors who have a higher degree of financial sophistication. We advise high net worth individuals and other clients who want more than just conventional wisdom when they are structuring their retirement investments. 

We develop a custom investment strategy and wealth management plan for each of our clients that is based on a client’s specific needs and goals. We then verify that our clients understand and approve their customized strategy, we make adjustments as needed before implementing any investment options,  and we regularly monitor both the performance of the strategy and the client’s own unique circumstances to incorporate necessary revisions that keep the strategy on path toward its defined goals. 

 

How Common Wisdom Can Derail a Retirement Investment Plan

An investor that seeks to maximize retirement investment without depleting all of the assets in a retirement portfolio might attempt to accomplish that task, for example, by following the 4% rule espoused by many retirement investment advisors. The 4% rule suggests that in retirement, an investor should withdraw 4% of his or her portfolio each year with adjustments for inflation. This rule, however, is built on a  foundation of a high aversion toward risk. Adherence to this rule with no consideration of an investor’s individual circumstances and risk tolerance may limit the investor’s enjoyment of his time in retirement. 

The weakness of a common wisdom approach toward retirement investment is further highlighted when an investor considers situations that can impact retirement planning.  Some examples of those considerations may be:

  • Does the investor desire to leave a family legacy with wealth that builds over several generations?
  • Are there philanthropic interests that should be served with a retirement investment strategy?
  • Does the investor have or anticipate having any special medical or other unique needs that will place extra stress on planned retirement income?
  • Has the investor factored in the impact of taxes on his or her retirement income?

 

Determining How to Invest for Retirment

As opposed to simply applying the 4% rule or some other common retirement mantra, we derive our retirement investment recommendations for each of our clients from a 4-phase process:

  • One of our advisors first conducts a detailed one-on-one client intake meeting to gain an understanding of the client’s personal values, relationships, and priorities, and his or her short- and long-term retirement income goals.
  • After analyzing the input from that intake meeting, we conduct one or more echo meetings directly with a client to iterate our understanding of the client’s retirement needs and goals. We use these meetings to fine tune our understanding and to uncover other motivations that drive the client’s need for retirement income.
  • We next propose our investment recommendations, which generally include a customized blend of core and tactical retirement investment holdings that can generate regular income and asset value growth during the client’s retirement years.
  • Lastly, we solicit regular feedback and we monitor the performance of each client’s unique portfolio to verify that our recommendations are meeting the wealth management needs and goals that we have helped the client to define.
    In every situation, our clients meet personally and individually with one of the members of the 6th Avenue Team. Every client account is assigned an account executive who  will answer client inquiries and respond directly when the client contacts our offices.  
 

No universal retirement investment guideline will tell you specifically how you should invest your retirement money.  A default rule for retirement income might push you toward a handful of investment products that are designed to meet that rule.

However, the best methodology for answering this question factors in your unique circumstances, needs, and goals. That methodology works with your investment experience and responds to your risk tolerance and desire for asset growth and income in your retirement years. It works with different types of retirement accounts, including IRAs and 401(k)’s, and investment products that incorporate tax efficiency that prevents erosion of your retirement income that might occur with inefficient tax planning. 

 

The financial consultants on the 6th Avenue Team at Ingalls & Snyder, LLC in midtown Manhattan believe that proper planning for retirement is more than just applying default strategies to a retirement investment account. Every one of our clients deserves a unique retirement income strategy and plan that is as unique as the client himself or herself. Our approach toward our financial advisory services reflects that belief. 

Please call our New York offices for more information about our retirement investment services and to schedule an appointment with one of our investment advisors.

 

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