Retirement Planning

Making the Real Choices of Retirement

Helping clients confront the financial realities characterizing today’s retirement – often longer and more active than those of previous generations – is a growing part of the job description for modern financial advisors.

“We find it rare that a client has sufficient assets to meet all of their goals and dreams, so it is our job to help them manage those expectations and cope with those unforeseen circumstances that commonly happen every day,” Gregory Makowski said. “It is our job to help clients confront these circumstances and expectations, and then build a plan of action. Confronting is the hardest job for most people. Getting clients to recognize that everything is a trade-off is difficult.”

Yet, this aspect of his job is what Makowski, founding partner and managing member of CFS Investment Advisory Services, LLC, based in Totowa, NJ, thrives on. CFS is an acronym for the words, “Common Financial Sense,” that Makowski trademarked for the firm he began in 1989. His slogan, “I Fix Broken Retirement Plans,” is more than just a phrase – it his goal for every client interaction.

His approach to growing wealth doesn’t use the latest and greatest in financial products, but instead remains focused on the simple, yet time-tested approach of using the lowest fee structures possible in the lowest tax environment possible.

“This is what has grown wealth over time for our clients,” Makowski said.

In part, this is why his clients won’t see Makowski and his team chasing after alpha returns. He isn’t a fan of constantly triggering stop loss orders based on market movement.

“If clients truly understand risk and understand income tax efficiency, then they know they do not want to trigger a lot of trades with stop loss orders,” he said. “If a portfolio goes up 30 or 40 percent and then goes down 10 percent and it has trailing stop loss orders that trigger out trades, it creates an enormous income tax problem.”

Instead, Makowski suggests paying attention to the lessons of historical market performance – what goes down, will go back up.

He also prefers to work directly with his clients in determining the contents of their portfolio. Cutting out the middle man – third party asset managers – gives Makowski the ability to “carve out” 50 to 100 basis points in fees. When calculating potential returns using equities with conservative numbers, such as six to seven percent per year over a realistic investment period ranging from ten to 15 years, Makowski said that those eliminated fees aid in compounding wealth at a rate much faster than chasing alpha.

In an industry where technology plays a pivotal role, Makowski remains a fan of human interaction, mainly because it is what he sees that his clients – even the Gen Y clients of younger advisors he is grooming – really want.

“Technology does make financial planning easier and more accessible,” he said. “But even our younger clients still want to talk to human people and bounce ideas off human people. The more technology takes control of our lives, the more people crave human interaction and experience. Even with the younger clients, they may go on these gamified technology platforms, but they still want to talk to a real live person.”

He attributes some of this desired face-to-face communication to the fact that, in his professional approach as a fiduciary who officially puts his clients’ interests first, he views his clients as part of his family.

“Our clients love to know that they are in the same boat as we are,” Makowski said. “We invest their money just like we invest our own.”

In fact, during the Great Recession of 2008 and 2009, Makowski said that while he was calling clients to steady their nerves during the market crash, his clients were calling him and his employees – to check on their emotional welfare.

“They were worried about us,” he explained. “They know we take it very seriously when our clients’ money is in jeopardy. They know that we get paid to take on all of that stress and to take that stress off their shoulders so they can worry less about what is going on. They trust us, but they also checked on how we were doing.”

He knows another market correction similar to that of The Great Recession most likely will occur. Not knowing when or what will trigger another plunge between 30 and 40 percent is what keeps him talking to clients about risk tolerance and management.

His conversations also include the idea of working longer than previous generations did. Retirement at age 65 may no longer be feasible. He runs Monte Carlo simulations changing small variables such as a half percent increase in inflation to give clients a forecast of what could happen to their nest egg.

“It gets them to confront the reality of what retiring for 30 to 35 years might look like financially,” he said. Most of the time, seeing that forces a reconsideration of how many years to remain in the work force. Makowski points out that some of his happiest clients are still working in their 70s and well in to their 80s. “They enjoy what they are doing. It gives them purpose in life. People have to re-think what retirement looks like and we are here for each client to help them do just that.”

Learn more about CFS Investment Advisory Services, LLC, online at

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