I’s 76 with $11K in Social Security and $450K saved. Is a financial adviser my next step?
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Question: I am 76 and a US citizen living overseas. I get $11,000 in Social Security and have liquid assets of $450,000. I estimate my life expectancy is about 15 more years. If a financial adviser would do a one-time consultation, what it would cost and what issues should I consider?
Answer: Pros say it probably doesn’t hurt to hire a financial adviser, as they can help you make sure your money lasts and you are able to live life the way you want to. And indeed, you have a lot to consider that a pro could help you think through. (Looking for a new financial planner too? This free tool can help match you with an adviser who might meet your needs.) Here’s what a one-time consultation might cost and the issues to consider:
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What issues should you discuss with the financial adviser?
Certified financial planner John Bovard at Incline Wealth says he has a client that he’s working with overseas right now that’s also a US citizen with a very similar arrangement. When planning, Bovard says issues he considers include taxes, opening accounts overseas, maintaining accounts in the US, applying for mortgages overseas, estate planning and writing the rules for beneficiaries.
Furthermore, “it would be necessary to project and determine your financial level of preparedness for future years and whether your investment portfolio is suitable for this purpose. Additionally, you should consider issues such as tax optimization and estate planning while living in another country,” says certified financial planner Alonso Rodriguez Segarra at Advise Financial.
Regardless of fee structure, the most important thing is to find a financial adviser who is competent in the unique needs of expats living overseas, says certified financial planner Jim Kinney at Financial Pathways. “Finding someone experienced in this field and also willing to work on a one-time consultative basis is important,” says Kinney. (Looking for a new financial planner too? This free tool can help match you with an adviser who might meet your needs.)
Additionally, he says you also need to be able to provide very good accounting for what it costs to live. “Include future considerations such as healthcare needs and long-term care options available to you in your country of residence and how those will be paid for if needed,” says Kinney.
The biggest question certified financial planner Ryan Haiss at Flynn Zito Capital Management says he receives from retired clients is: “’How long will my money last?’ Once we have all the data, we can create a custom financial plan that will help provide some clarity as well as some suggestions on how they can potentially improve their results,” says Haiss.
What might a one-time consultation with a financial adviser cost you?
There’s a lot of variance here, and it depends on the complexity of your situation, the adviser’s experience, and more. This comprehensive MarketWatch Picks guide will go through the costs of a variety of different planners and planning situation, including a one-time planning engagement.
Bovard says he “charged a one-time fee of $1,500 and ongoing annual fee of $5,000.” And Anthony J. Ogorek, certified financial planner at Ogorek Wealth Management, recently told MarketWatch Picks that if you decide to pay a flat rate for a financial plan, you might spend “anywhere from $2,500 to $10,000, though these are general guidelines that may vary by location, experience and the scope of work requested.” He says typical hourly fees can range from $200 to $500 depending on experience.
Given your circumstances, you might be best served by a CFP who provides hourly services: “Costs can range on average from $200 to $600 [per hour] depending on your chosen planner,” says Segarra. “Make sure you choose someone with experience working in the country where you currently reside and with American clients,” says Segarra.
The cost of working with a professional will vary depending on how in-depth your financial plan will be, “Our firm’s process will certainly take more than a one-time consultation. First, we would have an initial phone call or meeting to learn more about your specific situation, explain our process and answer any questions. This is a no-cost, no obligation meeting,” says Haiss. Then, they’d request specific information about investments, cash flow, tax returns and more.
Many planners work under flat-fee engagements, as well as hourly ones, so you should consider the questions you would like answered to determine the most cost effective option. Note that many planners offer a free initial consultation, so this is a good place to find out how they can help you and what it might cost.
“There are numerous outlets for you to find a fee-only planner to do a one-time consultation. Consider resources such as NAPFA, the Financial Planning Association (FPA) and the CFP Board’s Let’s Make a Plan site,” says James Daniel, certified financial planner at The Advisory Firm. Ask for their fees upfront. You can also use this free tool, which can help match you with an adviser who might meet your needs.
Looking for a new adviser or having an issue with your current one? Email picks@marketwatch.com.
Questions edited for brevity and clarity.
