Leadership

A Game Plan for Retirement Income

When a prospective client comes to see Wayne Fisher, president of Fisher Financial Tax & Insurance Solutions, Inc., they receive a copy of his book, “Guide to Surviving a Flawed System and Retiring with Confidence.”

It shows them there are better ways to handle retirement savings. For instance, in chapter one, “Lessons in Failure” discusses five examples of couples who hit home runs, with over $500,000 saved for retirement. The story shows how hard they worked to get there and what happened to them when they watched the market take it all away.

“Their broker told them, ‘Hold on, it will come back,” says Fisher. “If you’re 70 years old, you can’t hold on for nine years for stocks to do that – you want to be out traveling in your RV. There are better choices to be made.”

Besides his writings, Fisher conducts seminars and teaches retirement courses at local colleges and universities, and had a five-year run hosting his own local radio show. Through his work, he sees similar patterns with unsatisfied clients looking for shelter and going from one broker-dealer to another, often after a market loss. They end up with the same funds, no diversification and paying excess fees.

In fact, Fisher says that most people think they are diversified because they bought several mutual funds and bond funds, but when Fisher does a study on diversification it is expressed as a percentage. The average person has eight funds, but these funds are generally 80 percent correlated, so people don’t have the spread of risk protection they think they do.

After conducting an in-depth analysis of current investments and showing clients their risk/reward ratio, Fisher shows them the fees they were paying. Most don’t know about non-disclosed internal costs, such as commissions and fees on excessive turnovers, which can prove substantial. Running a Morningstar report, for example, might show a fund is turning over 70 percent in one year, meaning the manager doesn’t know what they are doing and churning up a lot of internal costs.

“It is pivotal clients understand where their money is and how it’s handled – it’s their life savings,” Fisher said. “Here’s where you are, here’s where you can do better. If a broker can’t explain your investments in a way you understand, walk away.”

Fisher devises a game plan giving his clients a stream of income they can’t outlive. The personalized plans include an income ladder. The income ladder’s goals are to get clients through the first decade of retirement, at the end of which they have the same amount of money left as they did in the first year of retirement.

He says long-term care insurance is “always a hot mess,” explaining companies can’t sell enough of it to support the rising cost of claims.

“It’s a poor investment,” Fisher says. “I use alternatives, such as life insurance you can overfund and leverage without risking the principal, and it will pay tax free.”

Such policies can satisfy needs other than long-term care. He says clients don’t liken long-term care insurance to homeowner’s insurance, even though their chances of needing long-term care are greater than the odds of their house burning down.

“They think, ‘If I don’t need it, I’ve spent all that money for nothing,’” he says. Through life insurance, clients find there’s a way to provide better coverage to pay bills and if they don’t need it, the family gets the benefits.

Fisher Financial Tax & Insurance Solutions has offices in Chico and Redding, California.

For more information, visit: www.fisherfinancial.net

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