The Advisory Career

Think Comprehensively, Plan Accordingly

Managing the evolution of wealth advisory

by Gary Katz and Peter Maller

Mr. Katz joined the Sagemark Consulting management team in 1988 and established his own practice in 1994. Currently, he is a “prestige planner” in the Sagemark Consulting Private Wealth Services Group, which comprises less than one percent of all Sagemark Planners. He specializes in helping retired individuals, owners of closely held businesses and other successful professionals, satisfy charitable desires, and efficiently transfer assets to future generations. Connect with him by e-mail:
Mr. Maller founded Maller Wealth Advisors in January 2014. Maller Wealth Advisors is a wealth management firm providing sophisticated investment strategies, comprehensive financial planning, and risk management services, as well as business succession planning and employee benefits for business owners, accomplished professionals and high-net-worth individuals. Connect with him by e-mail

Experienced financial advisors know that when it comes to working with a lifetime of income and assets, each client brings a different set of visions and goals to the table. Over the last two decades, we have watched our roles shift from financial specialists, mainly focused on investments, to comprehensive financial planners – a world that has become very specialized. As wealth protection specialists, advisors need to command a comprehensive view of the many products and resources available and must serve as the coordinating force for a client – leading the charge.

On our way to becoming Lincoln Financial Network’s 2013 Planners of the Year, we have amassed several comprehensive financial planning tips about four commonly overlooked areas that even seasoned advisors and financially savvy clients may find useful:

  • Inflation
    Inflation causes us to pay more for the same goods and services over time, eroding purchasing power. It also slowly eats away at the value of investments. If overlooked during wealth protection planning, inflation may negatively impact budgeting, seriously putting an individual’s standard of living in jeopardy.
    U.S. inflation rates have stayed between two percent and four 4 percent for many years. But staying informed on inflation trends is not enough. Every client’s plan should undergo a stress test with higher inflation rates to keep projections from falling short of actual financial needs.
    Advisors should help clients proactively protect their finances. Maintaining a desired financial lifestyle during retirement years is dependent upon how much wealth has been accumulated by that time and how fast those funds are spent. Considering inflation should be an integral part of the equation.
  • Plan for Ongoing, One-Time Expenses
    Ongoing, one-time expenses may sound like an oxymoron, but there are some big-ticket items that are generally unexpected, and can set individuals back significantly if not factored into the overall financial plan.
    These expenses may include anything from making home repairs to buying a new car, or even going on vacation. As individuals age, their ongoing, one-time expenses likely will rise due to healthcare, travel or gifting costs. Such expenses need to be built into a financial plan and adjusted annually.
  • Coordinate Wealth Transfer
    Clients are typically unaware of the many ways to distribute assets to family and other beneficiaries. It can be difficult for clients to compile an accurate inventory of assets to ensure they are distributed properly. Therefore, wealth transfer strategies are often left out of financial plans.
    A holistic financial strategy should cover more than just reviewing a will – although a will is a critical part of the plan, because if a person dies without one, state law will determine how his or her assets are distributed.
    Clients often forget about beneficiary forms, papers often signed and forgotten after starting a job. Reviewing and updating beneficiary designations is just as critical as making sure a will is in order. Annuities, life insurance, IRAs and retirement plans are just some of the assets that let individuals designate beneficiaries. Since those assets are automatically distributed to that beneficiary upon an individual’s death, it’s vitally important those documents be kept current.
    Most clients have not run financial models or adjusted their plan in years. As the economy changes and personal situations change, regular adjustments to financial plans are essential to reflect the realities of the current environment.
  • Incorporate Tax-Efficient Strategies
    Taxes are certain and cannot be predicted. We should assume tax rates will always change, but who can predict what Congress will do five years from now?
    According to a recent survey released by Lincoln Financial, “2013 – Expense Challenges of Age 62-75 Retirees,” retirees significantly underestimated the impact taxes would have on them during retirement.
    While taxes are unavoidable, advisors can help clients minimize tax bills and maximize savings. Diversification – asset location and allocation – are key. Accounts such as 401(k) plans or IRAs offer tax advantages to help clients accumulate more wealth. They can use vehicles such as life insurance, which has income tax free benefits, and annuity products, which provide a lifetime income stream while deferring taxes.

Advisors should stress test with different tax factors to determine the most tax-advantageous way to implement a client’s financial strategy. A financial plan is a living entity. It should be constantly reviewed and adjusted to reflect a client’s current situation.

Being an effective wealth protection specialist requires a special set of skills. Clients may want to diversify their professionals, using two advisors or bringing in an accountant or other specialist. However, this can create a lack of coordination and may lead to the overlap of investments and portfolio management. Wealth protection advisors need to take a holistic approach and build one solid plan before any implementation. Advisors need to assess the client’s assets, their current situation, future goals and potential risks, as well as regularly review the plan and current financial environment for needed modifications.

The holistic nature of comprehensive financial planning requires much more than a one-person band. Advisors are in a better position to be effective when they have a strong support system.. Whether it’s the operational and technological support of a leading broker-dealer or the deep relationships made by an experienced staff, these resources enable advisors to build a robust and growing practice.



Katz and Maller are registered representatives of Lincoln Financial Advisors Corp, a broker-dealer (member SIPC) and registered investment advisor. This information should not be construed as legal or tax advice. You may want to consult a legal or tax advisor regarding this material as it relates to your personal circumstances. CRN-950004-061814