There has never been a better time to find a financial advisor who is a fiduciary.

The investing world is full of uncertainty right now. Markets are roiled by unknowns, and even the surest and savviest of investors find themselves nervous about their businesses, their money, and their families’ futures.

How, then, should you proceed? What steps should you take to protect your assets now and grow them in the future? Enlisting the help of an independent financial advisor who can provide you with personalized financial advice and planning has never been more essential.

Is your advisor a fiduciary?

Whether you’re looking for an advisor or already working with one, you can start by asking two simple questions. Is my financial advisor a fiduciary? Are they always a fiduciary?

Independent Registered Investment Advisors (RIAs) are fiduciaries, legally bound to always act in the best interest of their clients. It’s an important distinction to understand when it comes to choosing who you want to manage your money.

Independent financial advisors go beyond advising you on point-in-time investment transactions and make sure that you understand your entire financial picture. You may be a self-made entrepreneur, a high-level executive, or the beneficiary of family wealth. Whatever your circumstances, your goals and dreams for how you use your money are deeply personal. The advisor you choose should be focused on building a plan highly customized to you, but that’s just the start.

What kind of relationship do you want with your advisor?

Once you have a plan, does your advisor proactively work with you to make sure that you’re staying on track? An independent Registered Investment Advisor can provide that level of care – they focus on building long-term advisory relationships with you and your family, serving as stewards of your money at all times, not just when you reach out to them. This is especially valuable in times like these. An independent advisor can work with you to help you make smart decisions based on data and not fear, helping you keep your plan on track.

Money can be emotional. Even during good times, you may still have complex financial situations come up that are emotionally delicate. A common scenario is the question of how you will pass on your assets and your values to the next generation. Your children or grandchildren may have mixed feelings about the legacy you leave behind and differing levels of ability and interest in managing their inheritance. An independent advisor could help you navigate not only the financial ins-and-outs of estate planning, but also the family dynamics around inherited wealth.

Or you may be a business owner contemplating the next phase of your life. You may have questions that are more strictly financial, such as “What is the value of my business?” But you may also have some questions that require deeper self-reflection, such as “Can I afford to retire? Am I really ready to retire?” An independent advisor can take a look at your life goals and your entire financial picture to help you make decisions that are right for you.

In fact, the way that independent advisors are compensated helps to support that long-term focus on your financial well-being. Independent advisors typically charge a fee based on a percentage of assets managed or services provided. This gives them the freedom to focus on doing what’s right for you, not on selling you products or meeting sales quotas. When you do well, your advisor does well.

Questions to ask yourself

Working with an independent financial advisor can be invaluable. An independent advisor can help you rethink the status quo or keep you from overreacting in times of stress. There is no substitute for their ability to listen to your concerns and formulate a plan that can keep you on track and, frankly, provide peace of mind, even under circumstances that are less than ideal.

Maybe now is the time to talk to an independent advisor, let them look at your assets and goals, and challenge some of your tendencies and assumptions to come up with a plan that best fits you.

So as you try and navigate the coming months and years financially, ask yourself the following:

• Can your advisor provide the customized guidance and full scope of services that you need?
• Is your advisor always a fiduciary? In other words, not just for a transaction, but for the life of the relationship?
• Do you have an advisor who’s responsive, attentive, and committed to helping you reach your long-term goals?

If any of your answers were “no,” perhaps it’s time to find your independent financial advisor.

Start now by checking out our list of advisors in your area. FindYourIndependentAdvisor.com

(0820-0SMX)

Americans now have a longer life expectancy—so their retirement assets need to last longer, too.

Two of Cam Goodwin’s clients—a married couple—recently faced a hard truth: Living just a few extra years can significantly impact your retirement expenses.

Goodwin, chief operations officer and managing partner for HawsGoodwin Financial, an independent Registered Investment Advisor (RIA) firm in Nashville, Tennessee, says his clients got a major wake-up call when they learned the husband’s elderly parents—in their 90s and living in an assisted living facility—were on the brink of outliving their retirement savings.

The couple, themselves in their late 60s, faced a double dilemma: First, they needed to rethink their financial plans so they could help support their struggling parents. Second, they realized they should plan a longer retirement period for themselves, too.

“My clients are a part of a new type of ‘sandwich generation’—they’re being squeezed to pay for care for their longer-living parents, and they’re also feeling pressure to accommodate their own increased longevity,” Goodwin says.

One smart way to find solutions for this dilemma is to work with an RIA. Don Blandin, president and CEO of the Investor Protection Trust, a nonprofit dedicated to providing consumers with noncommercial investor education and protection information, regularly advocates working with registered investment advisors because they are fiduciaries, “legally and ethically obligated to put your financial interests first and avoid any conflicts of interest.”

“In addition, RIAs can look at your entire financial picture to match your current financial strategies with your longer-term retirement goals,” he says.

And because this couple, like many clients, needed help with financial strategies—not more financial products—the choice was ideal. RIAs don’t earn commissions for buying and selling investment products. They work on a fee-only or fee-based system, so their goal and incentive is to put together a financial plan that’s right for the customer.

The good news: you’ll probably live longer

Goodwin’s clients are smart to assume they may live to an even riper old age than they thought. Americans’ life expectancies have significantly increased over recent decades. Back in 1960, for instance, people who lived to age 65 could expect to live another 13 years (men) or 16 years (women), according to the U.S. Centers for Disease Control. Today’s 65-year-olds are now expected to live another 19 to 22 years, estimates the Social Security Administration. In addition, a quarter of 65-year-olds are expected to hit age 90, and 1 in 10 will live past age 95.

Goodwin’s firm is similarly optimistic. They now create clients’ retirement plans assuming that men will live to age 91 and women to age 93.

“Overall, longevity is good news. You’re going to live longer than you thought!” Blandin says.“But the big follow-up question is: How do we financially prepare for that?”

How living longer impacts your finances

RIAs can be trusted to help investors address issues like longevity planning. After all, longer life can affect retirement planning in a number of ways:

• Retirees who “DIY” their retirement finances could get it wrong. “Pensions are an endangered species, so Americans are now handling many more complex retirement decisions than their parents or grandparents,” Blandin says. Individuals with little financial training may now choose their own retirement plans, decide how much money to contribute, select investment options and even decide on their own how much to withdraw each year so they don’t outlive their savings. “The chances for error are substantial,” he adds. However, an RIA can help clients avoid or fix potential mistakes.
• Longer retirement means more expenses. “Living even five or six years longer can be a huge financial deal,” Goodwin says. In addition to the ongoing costs of housing, utilities and other basics, retirees may also spend more discretionary money in the decades following age 65. Additional expenses could include things like travel, hobbies, new business startup costs and charitable giving. RIAs can help clients better estimate their living costs.
• Health care expenses will take a bigger bite. Studies suggest that the average healthy 65-year-old couple retiring this year will spend over $363,000 in health-related expenses in retirement.¹ And that figure doesn’t even include long-term care expenses—which aren’t covered by health insurance and could average another $266,000 throughout a retiree’s lifetime, according to the U.S. Department of Health & Human Services. Independent advisors also can help clients estimate health care costs and suggest a variety of ways to handle them.

A refreshed retirement plan

For his clients with the struggling, elderly parents, Goodwin determined that they could afford to fund three full years of their parents’ assisted living costs. In addition, he:

• Extended his clients’ life expectancies in their own financial plan to ages 95 and 97
• Added slightly more aggressive investments to their portfolio to provide for more future growth
• Helped them earmark funds to pay for 50 percent of their five grandchildren’s college expenses.

In the end, Goodwin’s clients are in good shape for a long retirement. They can also tackle other financial goals that are meaningful to them. Perhaps the happiest moment of the planning process, Goodwin recalls, was when he told his clients that their financial plan still allowed for them to buy a vacation home. “That was incredibly important to them,” he says. “They really wanted to have a place to bring their extended family together—and now they do.”

Wall Street Journal Custom Content is a unit of The Wall Street Journal advertising department. The Wall Street Journal news organization was not involved in the creation of this content.

1. “2018 Retirement Health Care Costs Data Report,” HealthView Services, 2018.

The named advisory firms (“Advisors”) custody some or all of their assets with Charles Schwab & Co., Inc. (“Schwab”). The Advisors are independent and not affiliated with Schwab, and their personnel are not employees or agents of Schwab. This is not a referral to, endorsement or recommendation of, or testimonial for the Advisors with respect to their investment advisory or other services. Schwab Advisor Services™ serves independent investment advisors and includes the custody, trading and support services of Charles Schwab & Co., Inc. Member SIPC. (1118-8URS)

Is working with an independent financial advisor right for you?

When you choose a professional to help manage your money, it’s easy to assume that all financial advisors belong to the same professional group and adhere to the same standards. In reality, though, “financial professionals fall into two general groups, according to whether they sell products or advice,” says Mike Delgass, CEO and managing director of Sontag Advisory, which has offices in New York, California and Florida.

It’s important to understand the differences between the two before you hire financial help. It’s also helpful to understand the advantages of working with an advisor whose main responsibility is to put your best interests first.

A tale of two types

The two main types of financial advisors are broker-dealers and independent Registered Investment Advisors (RIAs). Broker-dealers sell investment products, such as stocks, bonds and mutual funds, earning commissions on the products they sell, on trades and may also be compensated for meeting sales goals. RIAs provide holistic financial advice and make suggestions on how to structure investment portfolios. Delgass, whose company is an RIA, says most independent advisors like those at his firm earn their money by charging clients a flat fee for their work. They also may charge fees based on a percentage of a client’s assets versus earning income by selling specific financial products.

What’s in a name?

As for certified public accountants (CPAs), Certified Financial Planners (CFPs^®), wealth managers and other pros, don’t let their job titles confuse you, says Michael Nathanson, chairman and CEO of The Colony Group, an RIA firm based in Boston and other cities. Some of these designations—such as CPA and CFP—tell you that the professional has extra training and certification. Others, like wealth manager, typically are job titles within a company. Nathanson notes that most of these professionals still fall into one of the two broader financial advisor categories: either broker-dealer or RIA.

Standards of care

Delgass likens hiring an independent advisor to hiring an attorney when you have a legal issue or a buyer’s agent when you purchase a house: RIAs work solely on your behalf. You pay their fees, and they typically don’t earn commissions on the investment products you buy. In addition, when RIAs register with the U.S. Securities and Exchange Commission (SEC) or their state, they agree to abide by the fiduciary standard. This means they’re legally bound to put clients’ interests ahead of their own, Delgass explains. Fiduciaries must also disclose any potential financial conflicts of interest to their clients.

“It’s a very rigorous standard because it requires independent advisors to put the client at the center of everything,” Nathanson says.

Broker-dealers aren’t fiduciaries. Instead, they’re held to what’s called the suitability standard—they must agree to provide advice and sell financial products that are suitable, or generally appropriate, for their clients, a less rigorous standard than fiduciary guidelines.

Focus on relationships

Because their goal is often to offer comprehensive financial advice, RIAs tend to spend a lot of time getting to know their clients and their needs. For this reason, Nathanson says many purposely limit the number of clients they manage.

Delgass adds that because RIAs don’t earn product commissions, they aren’t tempted to sell unnecessary products or push clients to buy or sell within their portfolio.

Choosing financial solutions: an open field

“Independent RIAs frequently use what’s called an ‘open-architecture’ investment management style,” Nathanson says. Unlike many broker-dealers, who are affiliated with a single financial company and its products—or advisors who work for banks or other large companies—independent advisors often have greater freedom to objectively pick and choose investments and other financial solutions. “This open approach helps us offer objective financial advice and choose the best financial options from multiple companies for our clients,” he says.

Fee transparency

Because independent RIAs typically charge flat fees for their advice, there’s no question about how they’re earning their income. The RIA’s fee could be either a set dollar amount or a percentage of the financial assets they manage for you.

Checks and balances

To help safeguard your funds, independent RIAs usually use third-party financial companies (“custodians”) to hold assets. “In the world we live in today, clients want to know that their assets are safe from potentially unscrupulous advisors,” Nathanson says. An outside custodian helps offer that protection.

Of course, being an independent RIA doesn’t automatically make that financial advisor’s work superior. “Any professional who really cares about the people on the other side of the table can do a great job,” Delgass says. “However, I do think the RIA focus on providing advice and being a fiduciary—rather than selling products—naturally leads to a deeper relationship between financial advisors and their clients.”

Wall Street Journal Custom Content is a unit of The Wall Street Journal advertising department. The Wall Street Journal news organization was not involved in the creation of this content.

The named advisory firms (“Advisors”) custody some or all of their assets with Charles Schwab & Co., Inc. (“Schwab”). The Advisors are independent and not affiliated with Schwab, and their personnel are not employees or agents of Schwab. This is not a referral to, endorsement or recommendation of, or testimonial for the Advisors with respect to their investment advisory or other services. Schwab Advisor Services™ serves independent investment advisors and includes the custody, trading and support services of Charles Schwab & Co., Inc. Member SIPC. (1118-8URS)

Divorce among the 50+ population is rising, creating retirement challenges for the newly single.

Last year, a longtime client introduced his daughter to Eileen Allgrove, an advisor with Fiduciary Investment Advisors in Windsor, Connecticut. The daughter was in her 50s and in the middle of an amicable, but complicated, divorce.

She worked part-time until she had children; her husband was the family’s primary breadwinner for many years. Adding a wrinkle to the split: The husband had taken over his wife’s family’s business.

One way to navigate waters as challenging as these is to enlist the help of financial experts like Allgrove. As an independent Registered Investment Advisor (RIA), she doesn’t earn commissions for opening financial accounts on clients’ behalf or selling products. “Working this way keeps the relationship honest and transparent. That kind of trust is something divorcing clients particularly appreciate,” Allgrove says.

Why no commission-based work? As an RIA, Allgrove’s company focuses on suggesting strategies that take clients’ entire financial lives into consideration. It also means the firm’s advisors are fiduciaries who are legally bound to work in their client’s best interests.

The rise in Baby Boomer divorces

Allgrove’s client is one of many older Americans going through a so-called “gray divorce.” She has plenty of company: The U.S. divorce rate among adults age 50 or older has doubled since the 1990s.¹

“By the time they’re in their 50s, many couples have children who are grown and flown,” Allgrove says. “It’s not uncommon for people who spent years raising their families to suddenly wake up, experience that empty nest and realize they now want different things from their spouses. So they part ways.”

Some later-life splits can add significantly to people’s personal happiness. However, they can also undermine both partners’ financial stability.

“Gray divorces can hit both partners hard,” says Cindy Hounsell, president of the Women’s Institute for a Secure Retirement. “However, when you look at U.S. statistics, retirement-aged, single, divorced women are the most likely to end up in poverty.”

Even wealthy women can get financially blindsided by a late divorce, Hounsell adds. The main reason: lack of retirement planning.

A number of factors come into play, she says. For instance, some women temporarily—or permanently—step off the career track to have children, as did Allgrove’s new client. During that time, they may also stop contributing to their retirement plan. That can be problematic, since in the U.S., women who make it to age 65 tend to live an average of 2.4 years longer than men, according to the Social Security Administration.

Building a financial life from scratch

One particular challenge for divorced people is ensuring that their retirement funds—which typically are cut in half when they leave a marriage—will still be enough to support them.

Some partners assume they are eligible for half of their ex-spouse’s pension or workplace 401(k) if they split up. “However, that also assumes there’s actually money in the spouse’s retirement plan to claim,” Hounsell says. “By the time a couple divorces, one or both partners could have spent those funds or moved them.”

Divorced women, in particular, often put their children’s and grandchildren’s financial needs ahead of their own retirement needs, Hounsell says. As such, she cautions that trying to hang on to a too-expensive family home or pay for 100 percent of a child’s college costs, for example, can take too big a bite out of any divorced person’s nest egg.

“These issues are especially critical for later-life divorcees to face, since they have so few earning and investing years left before retirement,” Hounsell explains. However, working with an independent RIA can help people determine how best to start building their post-divorce financial lives.

Indeed, in Allgrove’s client’s case, the most pressing issue was that she was in her 50s with no retirement assets in her own name—and she didn’t have much time left to bolster her savings before age 65, the milestone year when many people consider retiring. She had planned to draw ongoing income from the longtime family business, as well as tap retirement funds that were in her husband’s name.

With those options off the table, Allgrove focused on helping her develop her own retirement plan, separate from her husband’s. They negotiated a five-year alimony agreement and a structured property settlement that required her husband to pay her a portion of their family company’s financial value over several years. Allgrove also helped her client move her cash settlements into retirement investments.

Removing retirement risks

Of course, not all gray divorces are so neat and tidy. John Krambeer, founder and CEO of Camden Capital, an RIA firm in Los Angeles, recently worked with a client who was going through an especially acrimonious later-life divorce.

The client, who worked for a Silicon Valley tech company, was the primary earner. Her husband borrowed heavily against his wife’s earnings and corporate stock options. He then entered into extremely risky investment agreements with ethically questionable people.

“When she came to us, our client, like many divorced people or really anyone looking for the right advisor, wasn’t sure who to trust with her money,” Krambeer says. However, as an RIA, Krambeer’s firm was able to step in as the woman’s fiduciary. On his client’s behalf, they slowly extricated her from her husband’s deals and created a long-term financial plan that allowed her to retire early and spend extra time with her two children.

As an RIA firm, “we get to find appropriate and tailored solutions for our clients every day,” Krambeer says. “Our goals—thank goodness—aren’t to meet sales quotas or pile up commissions. Our sole aim is to do what’s financially right for our clients.”

Wall Street Journal Custom Content is a unit of The Wall Street Journal advertising department. The Wall Street Journal news organization was not involved in the creation of this content.

1. Stepler, Renee, “Led by Baby Boomers, Divorce Rates Climb for America’s 50+ Population,” Pew Research Center, March 9, 2017.

The named advisory firms (“Advisors”) custody some or all of their assets with Charles Schwab & Co., Inc. (“Schwab”). The Advisors are independent and not affiliated with Schwab, and their personnel are not employees or agents of Schwab. This is not a referral to, endorsement or recommendation of, or testimonial for the Advisors with respect to their investment advisory or other services. Schwab Advisor Services™ serves independent investment advisors and includes the custody, trading and support services of Charles Schwab & Co., Inc. Member SIPC. (1118-8URS)

Often, your biggest financial opportunities can be spotted and corrected by financial professionals who thoroughly understand your financial – and personal – life. Registered Investment Advisors (RIAs) are suited to make these types of opportunities come to fruition. Watch the video above to discover the types of recommendations they can bring to the table and why it may be worth contacting one today.

Wall Street Journal Custom Content is a unit of The Wall Street Journal advertising department. The Wall Street Journal news organization was not involved in the creation of this content.