Absolutely, Bonnie. Thanks.
@Mark: We pay all dividends and interest into cash (money market) so that we can be deliberate about what we are buying to rebalance. The rebalancing bonus is worth about an additional 1.6%. If you reinvest dividends you risk putting too much in what is doing well. You also risk reinvesting and buying on Monday and then selling for a withdrawal on Tuesday and being hit with a "wash sale."
Mark, I agree with David. Unless you need the money to come to you, leave it to cash to more easily and less expensively re-allocate your portfolio as needed.
Thanks, all. Here's our next question from Ted.
You can begin at 59 1/2 unless you need the money earlier and want to look into 72(t) or other early retirement distribution options that get around the 10% early withdrawal penalty.
Ted -
Without penalty? after 59.5, with limited taxes? leave it to your children or grandchildren.
Alright, here's a good question from Nate.
Nate - my fingers are speechless :). Of course you should see an advisor - well, maybe. Do you need help with investments, goals, creating a retirement paycheck from your savings, home advice, is there a potential transition in your life (divorce?), estate planning, health care? Depends on your needs - but if you think you do, see a planner who plans - many only invest.
Nate, if you are married, I absolutely think you should talk to an adviser who is knowledgeable about SS income maximization strategies. This advice alone can save up to $250k per couple. The calculation is less complicated for singles.
Speechless fingers, eh Bonnie? :)
Nate - Sounds like you've done a great job preparing for retirement. The advantage of an advisor would be to help preserve what you have. A fee-only advisor through NAPFA will put the emphasis on you and not try to sell you products.
A lot of questions to consider, Nate.
Advisors, if Nate wanted to meet with an advisor just one to figure out if it's the right choice for him, he could do that too, right?
@Nate: I've seen a number of individuals who enjoy investing and financial planning and are more than capable of handling their finances on their own. When I tell them that, they often say, "Finally! I was looking for the advisor who wouldn't do too much differently because I'm tire of doing it and want to get a good advisor in case something happens to me."
Having said that, advisors often bring a greater value for the comprehensive financial planning than they do for the investment side. This can be worth a great deal in Roth conversions, safe spending rates, tax planning, estate planning etc.
I think needing an advisor also depends on if you are getting a comprehensive fee-only NAPFA member or you are getting a commission-based agent or broker. We would like to think the former are always worthwhile.
Alright, here's another very interesting question for you all from Steve.
Then, we'll go ahead and wrap up with three final questions from Bob, Mcintosh and Carol B.
Steve, can you do both, Can you bring clients so you don't starve the first few years?
Steve - Great question. If I were to make the change, I wouldn't do it for the money primarily. Bonnie is right...can you work part-time with your planner to make sure you enjoy it?
Steve, it's really, really rewarding work, helping people and solving their personal financial puzzles but getting clients is hard and takes a very long time to build trust - but the work is worth it if you can hustle to become well known in your community and be extremely visible. Our field is highly competitive.
@Mark: We pay all dividends and interest into cash (money market) so that we can be deliberate about what we are buying to rebalance. The rebalancing bonus is worth about an additional 1.6%. If you reinvest dividends you risk putting too much in what is doing well. You also risk reinvesting and buying on Monday and then selling for a withdrawal on Tuesday and being hit with a "wash sale."
