Charleston Wealth Management Advisors

Charleston Wealth Management Blog


Have you ever started a boat trip or cruised without a captain, without a navigational course charted, or heaven forbid without a rudder or steering mechanism? If you don’t have a plan in place before it’s time to set sail (or it’s your time to retire) how can you chart a course properly to navigate the different risks, issues, and opportunities that will occur during a twenty to thirty-year or longer retirement?


Over the last twenty-plus years of working with individuals and business leaders on retirement planning, we have found that those who have followed a process in their working careers were much more successful at making proper financial decisions regarding their retirement.

For example: A surgeon must carefully follow a well-defined process to achieve a successful surgery and an architect must draft a set of building plans before the builder can start ordering materials or can begin construction.

Most people who are accustomed to following a process in their working lives can then apply those process development principles to help them easily develop their plan to achieve their retirement goals. Simply stated…Retirement planning is much more effective when you follow a well-defined process.


But, those of us who have been successful in our work lives can still feel at a loss when it comes to planning effectively for retirement because we don’t know where to begin (we don’t have a process).

You may be eager to “jump in” and get started, but how can you start if you don’t even know what questions to ask to get the information you need to start on the right track?

Here’s how…follow a process based on facts and logic instead of myths, misconceptions and incomplete information. Retirement decisions are often like squeezing toothpaste out of the tube; once you squeeze the tube, you can’t put the toothpaste back in! If you proactively develop a well-defined retirement income plan first, you can avoid making critical financial mistakes (that often cannot be reversed).


Defined Outcome Investing

What if you could define your investment results and feel confident that they were achievable within your desired time frame and also taking into account the amount of risk you are willing to take?


Defined outcome investing allows you to earmark your retirement based assets to create income and/or growth based on parameters you set for risk and return in order to achieve a high probability for success in meeting your goals for growth and income in retirement.


There are two methods of defined outcome investing:


1. Growth investing: When you are investing in your pre-retirement years you want to make sure to focus on growth investing. During your accumulation years you’re typically willing to take on more risk because you have a longer time horizon before you plan on using your money.


2. Income investing: In your retirement years however, a shift occurs from accumulation or growth of your wealth to a “spend-down“ of a portion (or all) of your retirement assets…and risk is reduced to achieve the desired income you need (your desired outcome of a well-defined retirement income plan).


Transitioning from growth investing to income investing during the retirement red zone (the 5-10 years prior to and the 5-10 years after retirement) is critical in order to increase the probability of a successful retirement where your retirement assets don't run out before you do! Having this well-defined retirement income plan (combined with a defined outcome investment plan) can also reduce market risk, longevity risk, and sequence of returns risk. These are three critical risks in retirement that must be avoided when we are withdrawing from our investments to create retirement income.


Defined Income Planning

Remember the analogy that I used in the beginning of this article with the boat without a rudder? Developing a retirement income plan before you develop strategies of how to invest will help you increase your odds for a successful retirement.

If you don’t have the navigation plan in place first, how can you possibly know which investments to steer toward to accomplish your goals?

Having a well-defined retirement income plan will incorporate your expenses, your sources of income, and your timeframe of how long the assets earmarked for retirement “spend down” should last. A well-known financial author, Anthony Robbins, has been quoted as saying “old and broke are two things I do not want to experience at the same time in retirement.” Having a well-defined income planning process that generates a written income plan (created and reviewed annually by your personal CFO or financial planner) can help you avoid many of the risks retirees face while assisting you to “chart your course” and navigate properly throughout your retirement years.


Join Rick Durkee for his weekly podcast called “Navigating Retirement” visit www.cfpgroup.biz



On April 12th, South Carolina governor Henry McMaster renewed the state of emergency currently in place, extending it for another 15 days. The new executive order will continue the state of emergency amidst the COVID-19 outbreak until at least April 27, and maintains previous orders made by McMaster. While we are considered an “essential” business under the Governor’s orders, The Coastal Financial Planning Group continues to have most of our employees working remotely.


Rest assured that regardless of where our employees sit, they remain well equipped to perform their essential functions, and our firm remains open for business and prepared to address any needs or concerns you might have. All of our remote systems are secure and encrypted for your protection. Importantly, there is no change to our ability to:


  • Update your financial plan

  • Facilitate any trades including rebalancing

  • Invest new money or raise cash as needed

  • Process any new account paperwork or other important documents

  • Talk with you via phone, email, or virtually and answer any questions you have during this difficult time


While many of us are working remotely, we are still able to receive and process mail. We are also available via our email addresses, as well as by phone at (843) 735-5065.

We realize this is an unusual and trying time and our entire firm remains committed to helping you get through it. We hope to return to more traditional office arrangements as soon as the law allows but are grateful that our ongoing preparation and planning have placed us in a position to continue providing uninterrupted service despite these extraordinary circumstances.


If you have any questions, please do not hesitate to reach out to us – we are here for you.

We hope you and your families remain healthy and safe, and look forward to seeing you again in person as soon as possible.

Best,


Rick Durkee, LUTCF®

President, Founder and Chief Investment Advisor

Coastal Financial Planning Group

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Updated: Apr 13



Aside from politics and the upcoming presidential election, the big news item over the past six weeks has been the emergence of the Coronavirus and its impact on the globe. Another important factor to consider is what financial implications it may have on investments, the market, and your retirement plan. From our research and perspective although there are short term negative reactions to epidemics, ultimately, the health of the global economy and magnitude of monetary & fiscal stimulus dictate the direction of equity markets. In fact, in five prior instances, pandemics were a huge buy signal, dating back to 1997’s Avian Flu.


That said, while returns have been typically excellent coming out of pandemics, 2020 may be “different” because stocks were already rallying into the WHO (World Health Organization) identification.

Source: Bespoke, FS Investments


Is this time different?


  • Wuhan was a central rail hub during Chinese New Year festivities.

  • SARS represented a similar drag on the Chinese economy.

  • Goldman Sachs forecasts a 0.4% drag on US GDP for a quarter and the Street is forecasting a 1.5% hit to Chinese GDP this quarter.

  • It is too early to tell; however, the path appears similar to SARS and MERS

Sources: Matthews, Bloomberg, Bianco Research


In summary, will the Coronavirus have a major impact on your retirement planning?


Although there are short term negative reactions to epidemics, ultimately, the health of the global economy and magnitude of monetary & fiscal stimulus dictate the direction of equity markets.

Markets have shown a tendency to overestimate the impact on GDP and global growth. Historically, markets and economies have recovered a quarter after the pandemic’s growth rate slows.

In 2003, the Chinese economy only accounted for 4% of world GDP and the US economy was 7.5x larger than China. Today China is 16% of global GDP and the US economy is only 1.5x larger.

China’s economy was on steadier ground in 2003 – unlike today.


Markets may be more vulnerable to selling pressure this time around. If you would like to discuss the possible implications of the Coronavirus on your retirement planning please don't hesitate to call us, (843) 735-5065

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Coastal Financial Planning Group

78 Ashley Point Drive Suite 201 
Charleston, SC 29407

(843) 735-5065

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Investment advisory services are offered through Fusion Capital Management, an SEC registered investment advisor. The firm only transacts business in states where it is properly registered, or is excluded or exempted from registration requirements. SEC registration is not an endorsement of the firm by the commission and does not mean that the advisor has attained a specific level of skill or ability. All investment strategies have the potential for profit or loss. 

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