I’m a Financial Advisor: These Are the Top 4 Questions High Net Worth People Ask Me

Nicole Spector  Thu, August 1, 2024   GOBankingRates

Money can be complicated, and it doesn’t necessarily get any less so if you have a ton of it. In fact, it can get even more complex. Even high net worth individuals have stumbling blocks and points of confusion.

GOBankingRates spoke with financial experts who manage high net worth clients to learn about the most common money-related questions people with a lot of wealth ask — and the best ways to answer them.

Retirement Planning: Whether you're planning for retirement, dealing with a significant life event or simply looking to make smarter financial decisions, a financial advisor can offer the expertise and guidance you need. Here are some compelling reasons why you should consider a financial advisor -- even if you're not wealthy.

‘Will I Outlast My Wealth — Or Vice Versa?’

In the world of high net worth clients, Charlie Massimo, SVP and financial advisor at Wealth Enhancement Group, sees one critical concern looming especially large: The question of whether they will outlast their wealth — or vice versa.

“Surprisingly, many high net worth investors find themselves uncertain when faced with this pivotal question,” Massimo said. “There is an approach which is simple yet profound: We guide them to set specific, tangible goals and not vague aspirations like outperforming the market, but concrete objectives, such as generating $300,000 post-tax income by age 65.”

From there, Massimo crafts a plan tailored to support these goals, ensuring that every financial decision aligns with the client’s big plan rather than market ups and downs.

 ‘Can I Retire?’

Even high net worth individuals are wondering about whether a comfortable retirement is feasible for them. Katherine Fox, CFP, founder of Sunnybranch Wealth, often hears the question: “Can I retire?”

“The answer to this question depends on two factors,” Fox said. “How much money you have saved and how much income you need every year.”

Many of Fox’s clients are in their 20s, 30s and 40s and looking to retire early.

“They can usually accomplish this goal within their ideal timeframe, but it means taking a deep dive into their current and future spending and understanding what tradeoffs may come with an early retirement,” Fox said. “The ‘safe’ rule of thumb is that if you plan to withdraw 4% or less from your portfolio each year, your investments can support your lifestyle in retirement.”

Yet this rule of thumb, Fox noted, glosses over the important aspects of retirement planning for young, high net worth individuals.

“Retirement expenses are rarely static, and many wealthy people expect to maintain their current standard of living in retirement,” Fox said. “If the market was down significantly for several years, withdrawing 4% per year may not pay for your lifestyle expenses, and withdrawing more than that may mean you run out of money too soon.”

To Read More: https://www.yahoo.com/finance/news/m-financial-advisor-top-4-120053016.html