Financial Needs Cornerstones - Mesotherapy Worldwide - Affordable
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30 AMERICAN JOURNAL OF MESOTHERAPY FINANCE AND ACCOUNTING * This is an excerpt from Genworth Financial Advisers Corporation Portfolio Advisory Services (PAS) Investment Committee Newsletter The financial services industry has tradition- ally focused on helping clients plan for retire- ment and accumulate funds. This has meant pro- viding strategies for accumulating assets, opti- mizing returns, and reaching the financial goals of retirement. But the world has changed. The first baby boomers have already turned 60; human lon- gevity has increased so much that a person might spend as many years in retirement as he or she spent in the working world; and health care has become one of the most important costs to plan for in retirement. Our goal is to help clients maintain their lifestyle for decades past retirement age with strategies that ensure they do not run out of Stanley J. Nieminski Financial Needs Cornerstones
Transcript of Financial Needs Cornerstones - Mesotherapy Worldwide - Affordable
30 A M E R I C A N J O U R N A L O F M E S O T H E R A P Y
FINANCE AND ACCOUNTING
* This is an excerpt from Genworth Financial AdvisersCorporation Portfolio Advisory Services (PAS) InvestmentCommittee Newsletter
The financial services industry has tradition-ally focused on helping clients plan for retire-ment and accumulate funds. This has meant pro-viding strategies for accumulating assets, opti-mizing returns, and reaching the financial goalsof retirement. But the world has changed. The first
baby boomers have already turned 60; human lon-gevity has increased so much that a person mightspend as many years in retirement as he or shespent in the working world; and health care hasbecome one of the most important costs to planfor in retirement.
Our goal is to help clients maintain theirlifestyle for decades past retirement age withstrategies that ensure they do not run out of
Stanley J. Nieminski
Financial Needs Cornerstones
32 A M E R I C A N J O U R N A L O F M E S O T H E R A P Y
FINANCE AND ACCOUNTING
*The opinions in this article are not intended as individualinvestment advice by Genworth Financial Advisers Cor-poration and Stanley J. Nieminski. Investment and in-surance products distributed by Genworth Financial Se-curities Corp., member NASD/SIPC and a licensed in-surance agency (dba Genworth Financial Securities andInsurance Services in CA); Investment advisory serviceis offered through Genworth Financial Advisers Corp.,an SEC Registered Investment Adviser, with its homeoffice at 200 N. Martingale Road, Schaumburg, IL 60173;888 528.2987. For more information and a copy of aGenworth Advisers Corp. Form ADV Part II, pleasecontact Stanley J. Nieminski at 773-775-0033 [email protected].
money. At Genworth Financial, we have estab-lished a comprehensive program called Fi-nancial Needs Cornerstones designed to help ourclients think systematically about their financialneeds within the context of their entire lives.
The first cornerstone is accumulation andwealth management, and represents the traditionalexpertise of the financial services industry. Forthis cornerstone, our primary focus is on thegrowth and preservation of investments, with asecondary focus on passing on wealth efficientlyand in accordance with client wishes.
The second cornerstone is lifestyle preserva-tion, and it is primarily concerned with how cli-ents protect their financial assets through the useof insurance. This cornerstone represents the needto build strategies to deal with the consequencesthat sickness, accidents, or longevity can have onany retirement plan.
At the heart of this second cornerstone is pro-viding for the long term care expense that statis-tics tell us one out of every four Americans willneed at some point. Long term care planning isplanning for the entire family. Who will help whena client needs long term care? What happens to aclient’s life when he or she has to provide longterm care for a spouse or relative? This planningis essential to every client’s financial and eco-nomic well being.
The third cornerstone represents a guaranteed,sustainable retirement income. Even in caseswhere there has been a substantial accumulationof assets, a portfolio that has to provide incomefor 40 or 50 years carries significant risks. Rely-ing solely on a fixed income during retirement islike having a job that does not give a raise for 25years. Will those assets support the investorthrough the ups and downs of market cycles andthe significant erosion of buying power for 25years or more?
We no longer view this issue in a linear way. Itis extremely unrealistic for retirees to think they
can count on a 3% inflation rate, a 9% portfolioreturn and a withdrawal rate of 6%, stretching outindefinitely over many years. Given the new lon-gevity factors, industry experts have used MonteCarlo simulations to model a wide variety of eco-nomic factors over a wide variety of marketcycles. The results suggest that 4% may be thesafe withdrawal percentage, and even this is not asure thing. One of the most important risks con-cerns the timing of a client’s retirement: retiringin a down market and losing money in the firstyear of retirement can devastate a well-plannedretirement strategy. The addition of an annuity’ssustainable income stream can mitigate risk andprovide retirees with both some level of controland the security of a lifetime of income. We canoffer suggestions about using annuities effec-tively within the context of the entire retirementplan.
We hope that this introduction to our FinancialNeeds Cornerstones program has provided ourreaders with food for thought. For more in-depthinformation that is also customized to anindividual’s own situation, call your GenworthInvestment Adviser Representative today.
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