Financial Planning During the Countdown to Retirement

“The five years leading up to retirement involves a transition to a new stage of life, and this transition takes a great deal of planning — both emotionally and financially,” said Mitchell R. McCann, private wealth advisor and managing director at McCann Retirement Strategies (MRS).

Based in Bloomfield Hills, Michigan, McCann Retirement Strategies provides what McCann describes as “business planning” for soon-to-be retired investors. MRS is a private wealth advisory practice of Ameriprise Financial Services, Inc., and works with investors currently undergoing a transition in life such as retirement, divorce, sale of a business, or the loss of a loved one.

“I have a very narrow focus, and it’s come with years of developing my core competence,” McCann told “Advisors Magazine” during a recent interview. “My investment techniques and methods have evolved from my early years as an investment broker, to my mid-career of practicing the theories of modern portfolio management, to today. Presently, our methods are built on the thinking and philosophy that dividend growth consistently compounds our clients – and our own – money in good economic times and not so good economic times.”

McCann eschews the asset allocation model practiced by many advisors and instead relies on historical trends in dividend payouts.

“It’s a simple, straightforward plan designed to create growing income. And, what’s more, because we adhere to strict standards, our clients have the confidence knowing we’re committed to putting their best interest first. We give each of our clients a report card annually, so they can see how their income has grown,” said McCann, and he added, “Our job is performance.”

Operating from the belief that investing is like running a small business, McCann treats each client like they are an owner in a diversified conglomerate. In his conversation with “Advisors Magazine,” he repeatedly stressed that he does not build “financial plans,” but rather “business plans.” McCann says that “retirement is all about income,” and sees investing as an “age-weighted” exercise that has three stages: the accumulation stage, the transition stage, and the distribution stage.

“Generating sufficient cash to meet your needs will be a primary objective until you die. During your accumulation years, you must make wages, salaries, and bonuses do double duty, providing for current needs while investing for your future. Our goal is for the invested cash to generate sufficient interest, dividends, and capital appreciation to meet your future needs when your wages, salaries, and bonuses are no longer your primary sources of income. Your long-term challenge then will be to balance your cash flow between your current cash needs and your need to accumulate cash for the future,” McCann points out.

wesley400x500During the critical five years prior to retirement is when McCann Retirement Strategies excels, and McCann has packaged his proprietary process.

“Since I decided to specialize in this area back in 2003…I’ve taken all this experience and created my own workbook titled, “The Five Years Before You Retire and Beyond-Making the Emotional and Financial Transition to Retirement,” explained McCann.

When asked about the distribution stage of life, McCann reiterated that “generating sufficient cash to meet your needs will be a primary objective until you die, and for some even after they die.” To help clients bridge the financial transition to retirement, the McCann Retirement Strategies team looks at all the aspects that may affect a client’s financial position. “We do the math,” McCann says.

Rather than working through client expenses by listing out liabilities and working through spending point -by-point, McCann takes an approach that works with the investor’s personality, not against it. During a thorough examination process, McCann takes clients along a journey to recount their spending habits as they existed over the past two years.
He recommends adding up everything you’ve spent over the past twenty-four months and simply dividing it by 24. This will give you your average monthly spending for the past two years. McCann says you will probably be shocked by the amount.

Once clients pin down their expense statement, McCann Retirement Strategies helps them build an income statement to meet and exceed their retirement expenses.

“Investing for retirement is completely different than investing before retirement,” McCann said.

Generally, the firm looks at three areas when building client business plans for retirement: safety, income and growth. McCann stressed that investors need to secure those three investing pillars in that order.

Often, McCann will unpack a new or prospective investor’s current portfolio or financial plan, only to find it is burdened with too many investment schemes, managers and products. He calls these over-burdened portfolios “financially unhealthy.” McCann says during his 30-plus years of experience he has witnessed, time and again, that financially unhealthy portfolios often produce high fees and subpar returns.

McCann Retirement Strategies offers a rather simple solution to generate retirement income. McCann uses historical trends to identify companies that pay dividends and maintain strong growth rates. Building upon identifiable income streams such as Social Security and pension amounts, McCann leverages a dividend growth philosophy, which helps structure his clients’ income statements in order to meet their expense statements.

“For clients, we address income and total return potential to help with wealth accumulation, it’s the best of both worlds – income and total return potential for wealth accumulation,” he said.
When asked about recent market volatility, McCann explained his philosophy on market trends and investment strategies.

“We participate in the economy, we don’t bet on the economy. Economic cycles are hard to predict, and are almost impossible to outsmart,” he said, “McCann Retirement Strategies wishes to directly own a diversified group of companies that generate cash and earn above average returns on capital.”

nicole350x400McCann says one of McCann Retirement Strategies greatest attributes is the team’s willingness to share their thinking with others and openly demonstrate their discipline and consistency to providing safety, income, and growth to their investors. He believes these methods allow him to sidestep marginal returns provided by the many “financially unhealthy” portfolios he sees regularly.

Believing that there is a need for better investor education, McCann spends a great deal of time lecturing. His longevity in the financial industry and his commitment to education has translated into a large following.

Those who remain grounded and disciplined in basic principles can survive upheavals far better than those who do not,” said McCann. “Power comes from education. If we can make the people we talk to better investors, then that may solve some of the problems they have-both emotionally and financially.”

“I honestly think too many people are confused about how to invest money. Here at MRS, we are long-term investors, and rarely do we try and predict the direction of the stock market, the economy, interest rates, or elections. We spend zero time listening to those that try,” McCann said. “We look to buy great companies when they are cycling down in price. We study the facts and financial condition of our companies and seek to own them when their historical price/dividend is in our favor. We look at the clients’ accounts as running a business and we seek a large margin of safety.”

McCann says that his practice works with “real people making real transitions.”

“Our clients are retiring or selling their business, or they recently went through a divorce or lost a loved one,” he said. “McCann Retirement Strategies understands that these are as much emotional issues as they are financial. We take the time to guide our clients every step of the way during these transitional moments we all face.”

For more information on McCann Retirement Strategies, visit:

Ameriprise Financial cannot guarantee future financial results. Investment advisory services and products are made available through Ameriprise Financial Services, Inc., a registered investment adviser. Ameriprise Financial Serices, Inc., Member FINRA and SIPC.
©2018 Ameriprise Financial, Inc., All rights reserved.


Follow Us

Subscribe to Our Newsletter

What's Next, Updates & Editorial Picks In Your Inbox

Related Articles

© 2017-2021 Advisors Magazine. All Rights Reserved.Design & Development by The Web Empire