Resources

Financial Planning

Preparing for the Unexpected: Disability

A wealth builder’s ability to earn income is typically their most valuable asset. Losing an income could very well total a loss of millions of dollars over a client’s lifetime. For example, assuming a 2.5% annual increase in income, a 43-year-old earning $150,000/year and planning to work until age 65 would lose $4,329,424 in lifetime income if they became permanently disabled today.1 This would likely be devastating to their short- and long- term financial stability, as even a substantial emergency fund and/or investment portfolio can be depleted quickly, and at the jeopardization of other goals.

Advisor and client having a conversation

Financial Planning

Transtheoretical Model of Behavior Change

As we all know, most people are naturally resistant to change. You can gain insight on potential reasons why clients may be resistant to suggestions, advice, or tasks you ask them to complete by understanding The Transtheoretical Model of Behavior Change (TTM), developed by researchers James Prochaska and Carlo DiClemente in 1983. This model can apply to both prospecting – and motivating clients to follow your advice.

Financial Planning

Goal Setting – A Win-Win for Advisors and Clients

According to Savology, people actively working toward clear goals are 10 times more likely to succeed. Your discovery meetings and review meetings can be a great time to talk with clients (both existing and prospective) about their financial goals, both for the current year and beyond. Any new goals can be added to the client’s financial plan, and existing goals can be reviewed and updated. Below are broad examples of some short-, medium- and long-term goals.

Four seasons with arrows showing a cycle

Financial Planning

Life Cycle Financial Planning

Life cycle financial planning refers to the process of identifying and managing the financial needs and challenges that arise at different stages of life. As clients go through the various stages and life changes, their responsibilities, needs, and financial capabilities are likely to shift, so it is important to understand the needs of each phase to best serve clients. Below is a list of the 5 stages of the financial planning lifecycle, with examples of key financial planning needs at each stage.

Person holding coffee looking at health insurance website

Financial Planning

Understanding Marketplace Health Insurance

How can clients obtain health insurance if they plan to retire prior to the Medicare eligible age of 65 or lack job-based coverage? The federal Health Insurance Marketplace (www.healthcare.gov), also called the “Exchange,” is the website where individuals can browse, compare, and purchase health care plans available under the Affordable Care Act. Many states, including Pennsylvania, Maryland, New Jersey, and New York, have their own marketplace website.

Financial Planning

The Seven MAGI Calculations

Modified Adjusted Gross Income (MAGI) is a key calculation used by tax professionals and government agencies to determine an individual’s eligibility for various tax credits, deductions, and other considerations. It is based on an individual’s Adjusted Gross Income (AGI) with addbacks specified in the Internal Revenue Code. The concept of MAGI may seem straightforward; however, did you know that the IRS has seven separate definitions?

Financial Planning