3 Reasons It May Be Time to Find a New Financial Advisor Before Retirement

If you're within five to ten years of retirement, the focus of financial advice often shifts dramatically. While investment management remains important, retirement introduces new planning opportunities involving taxes, income, charitable giving, estate planning, and withdrawal strategies.

Longevity Doesn't Always Mean Better Planning

Working with the same advisor for decades doesn't automatically mean every opportunity is being addressed. Long relationships are valuable, but retirement planning can benefit from conversations that may not have been necessary or as important during your accumulation years.

A Real Life Example

Bob and Sue had worked with the same advisor for more than 30 years. Another professional referred them to us after the sale of Sue's family business. Our conversations quickly revealed that little to no attention had been given to tax strategy, charitable planning, estate coordination, or withdrawal sequencing. They were financially secure, but, given the lack of additional planning, were likely to pay more taxes than necessary.

Why Retirement Planning Changes

Accumulation focuses primarily on saving and growing assets. 

Distribution focuses on how those assets are used. 

Tax efficiency, future required minimum distributions, Social Security timing, charitable strategies, and sustainable income all become increasingly important.

Three Signs It May Be Time for a New Advisor

1. Your advisor has become complacent. 

If you rarely hear from your advisor, valuable planning opportunities may be missed.

2. Conversations focus only on performance. 

Your financial plan should be about your goals and how your resources fit appropriately into your particular situation, not just how your rate of return was last quarter. 

3. Retirement planning topics never come up. 

If discussions never include where you are expected to fall in current and future tax brackets, RMDs, qualified charitable distributions, Social Security timing, or withdrawal strategies, it may be time to ask deeper questions. 

Frequently Asked Questions About Retirement Planning 

Should I leave a long time advisor? 

Not necessarily. 

The question is whether your planning has evolved as retirement approaches. If it has not, and if your current advisor is not qualified for or focused on the practice areas that are most important to you at this phase of life, then you may want to consider a new advisor. 

Why is tax planning more important in retirement? 

Taxes can significantly affect how much of your retirement savings you actually keep. 

As you approach and enter retirement, you likely have more opportunities for tax planning than ever before. You may have different options from which to pull money and when, and you may have more control over how much income you recognize in given years. 

Further, there are important tax planning opportunities that are triggered at various ages such as age 59.5, 62, 67, 70, 70.5, 73, and 75. 

What should a retirement advisor discuss? 

Income strategy, tax planning, Social Security timing, estate coordination, charitable planning, and long term cash flow. 

All of these and more should be discussed in terms of your particular situation. 

Final Thoughts 

Long term relationships are valuable, but depth of planning matters just as much. If you're approaching retirement, ask whether your financial strategy is evolving with your life. Clarity is just a conversation away. 

Investment advisory services are offered through CapSouth Partners, Inc, dba CapSouth Wealth Management, an independent registered Investment Advisory firm. Information provided by sources deemed to be reliable. CapSouth does not guarantee the accuracy or completeness of the information. This material has been prepared for planning purposes only and is not intended as specific tax or legal advice. CapSouth does not offer tax, accounting or legal advice. Please consult your tax or legal advisor to discuss your specific situation before making any decisions that may have tax or legal consequences. This story is based on the experience of a client of CapSouth; for privacy purposes, the client's name has been changed. This story is not, in any way, to be construed as a client testimonial about the quality of CapSouth's services or the client's experience working with CapSouth. This story is related from the point of view of a CapSouth investment advisor representative; it is not intended to imply, in any manner, how the client would rate or how satisfied the client was with the services provided by CapSouth or their experience in working with CapSouth. This story is not a guarantee of future results, and it does not imply that these results are typical or that other similar clients will have similar results. CapSouth reviews each client situation individually, in light of their goals and circumstances; therefore, services provided, recommendations, and outcomes will vary.