Retirement management may be a classic win-win scenario. A fast-growing segment of the population urgently needs sound retirement advice and related services, while the accountants who provide them can derive considerable economic (and emotional) rewards for doing so.
That Baby Boomers are on the verge of exiting the workforce or winding down their careers is hardly news. But the fact that the Baby Boomer cohort includes an abundance of CPAs who will be leaving the scene creates opportunities for their younger colleagues.
“A lot of these Baby Boomers are going to look up and say, ‘Where did my [advisor] go?’” said Michael J. Fitzgerald, CPA/PFS, CFP and a member of Generation X who runs Fitzgerald Financial Partners, a Houston-based wealth advisory firm. Fitzgerald’s focus is on helping people make the transition to retirement.
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And Bradley Smegal, CFP, a Minneapolis-based financial services veteran and a managing director of Wachovia Securities, has zeroed in on the opportunity to guide clients through what he termed major “liquidity events” in their lives. Such events can include the sale of a business or receiving an inheritance, but almost always occur at retirement, he said, when people need to redeploy substantial assets.
Often, Smegal said, “Individuals wake up and say, ‘I need a higher level of advice than I’ve been receiving in the past.’ ... We want to be sure we’re there, not after the fact, helping them the whole way.”
FINDING ANSWERS
Although clients’ needs at this stage often are varied and complex, they don’t expect advisors personally to have all the answers. But CPAs’ educational grounding in accounting and tax matters, when supplemented by expertise in investments and insurance, often are well-suited to serving as the primary professional resource to help clients make the transition to retirement, and to secure needed estate planning or other specialized technical expertise they cannot provide directly.
Among many other things, said Jack Oujo, CPA/PFS, CFP, a good accountant can come up with a retirement plan distribution strategy that’s very tax-efficient. Oujo, based in Wall, N.J., said that financial advisors who lack the accountant’s number-crunching orientation may be disinclined to help clients with the essential detailed-oriented analysis of their expenditure patterns before mapping out a retirement strategy.
Oujo rejected the rule-of-thumb shortcuts suggesting that retirees need a fixed percentage of their pre-retirement income to sustain themselves. He and others stress that there’s more to helping your clients achieve a successful retirement at the front end than mere financial analysis, tax and investment planning.
“We’ve got all the quant tools. But what we really try to do is to marry those with the qualitative aspects, bring the lifestyle discussions into the mix,” said Smegal.
And how does he do that? “It gets down to starting the conversation,” he said, “encouraging clients to question and create, until we have a sense of exactly what they’re trying to accomplish in their lifestyle.”
