Ep. 226 – Integrated Wealth Management Experience in Retirement

In this Episode of the Secure Your Retirement Podcast, Radon and Murs discuss the elements of their integrated wealth management experience approach. An integrated wealth management experience offers a similar approach to a family office but for multiple people. A family office is a scenario where you have enough assets that you need a whole team to help you manage those assets.

Listen in to learn more about the elements of an integrated wealth management experience: a retirement financial plan, specific-to-the-client investment process, and tax planning. You will also learn how we’re involved in every step of the wealth management process, in-house or with a partner.

In this episode, find out:

  • A family office – having enough assets you need a whole team to help manage those assets.
  • How we created an integrated wealth management experience that looks like a family office.
  • The three elements of our in-house and partnered integrated wealth management experience.
  • The importance of estate planning as part of the integrated wealth management experience.
  • How we work with an expert to simplify and plan the social security side of things.
  • How we analyze a client’s situation and help plan for health insurance ourselves or with partners.
  • How we make the financial plan and wealth management process easier for the client by being involved.

Tweetable Quotes:

  • “The reason why estate planning is so important as part of the integrated wealth management experience is because if we don’t have things in place, it can make it very difficult for whoever we leave behind.”– Radon Stancil 
  • “Social security can be simple and complex at the same time, and that’s why we have a social security consultant on retainer with us that we tap into for her knowledge.”– Murs Tariq


If you are in or nearing retirement and you want to gain clarity on what questions you should be asking, learn what the biggest retirement myths are, and identify what you can do to achieve peace of mind for your retirement, get started today by requesting our complimentary video course, Four Steps to Secure Your Retirement!

To access the course, simply visit POMWealth.net/podcast.

Here’s the full transcript:

Radon Stancil:Welcome to Secure Your Retirement podcast. Today Murs and I are going to have a discussion and try to explain, what we call to our clients anyway, is an integrated wealth management experience. So I’ll say that one more time because that was a mouthful. Integrated wealth management experience. What does that mean? What does it look like? Why is it that that might be important to some people? So before we get into that and why we have it set up that way, maybe you’ve heard of something called in the past or maybe you’ve heard of what’s called a family office. And before we kind of go into a lot of this detail, I think you just want to understand the premise. So Murs, maybe you could take a little bit here and just kind of say, what is a family office? Why would that be important to somebody and who would that apply to most likely?
Murs Tariq:Yeah. So sometimes you’ll hear that term thrown around. And the family office, it’s really catered to what I would consider the ultra-high net worth. Where you have enough assets that you need a whole team behind you or working for you to manage those assets, not just from an investment management perspective, but the whole taking care of everything that comes up with the family, whether it’s the family businesses, even as far as taking care of the budget and paying the bills for whatever’s going on in the family, managing credit cards, managing cashflow, managing rental properties, real estate, all these elements of what could build up a very high net worth type of family. And when I say ultra-high net worth, I’m talking $50 million, $100 million up into the billions of dollars. That’s where you’re talking about a family office where the assets that they have are, you only need to be your own client in all essence.
You’ve got enough money and you’ve got enough assets that you need a whole team to help you manage everything that goes with that. So it’s not just hiring an investment manager to invest for you in the stock market, it’s also working with a insurance or having all these elements of significant comprehensive financial planning, which is all around taxation. Especially in this level of asset class, you have to be worried about estate planning and how the assets are going to transfer. So you’re working with attorneys, you’re working with CPAs, but the key here is that they’re all, in all essence employees of you. You have enough assets. So you create what is called a family office. You get registered with the SEC, and you have all these employees under you that are there to take care of what the family business needs, which is good management, good wealth management, and good thinking for the future, and also for inheritance.
Radon Stancil:Yeah. I was just going to say, and if we just take some of the elements of why that would be necessary is that you’ve got, if a person’s in that position, they need experts in a lot of different areas. So you might on that team have in all essence what we’d call a CFO, a chief financial officer. And that chief financial officer may be somebody that’s like saying, ‘Hey, okay, I need to go get an expert dealing with this type of estate plan’. Now they may say, ‘well, we don’t need to hire an estate planner for the family. What we’ll do is we’re going to go find one and they’re going to be a part of the team’. But somebody’s managing that expert. They’re going out and saying, ‘Hey, here’s what this family needs’. So they go find the estate planning attorney, they get this work done and get it all set up and then manage that whole entire process.
Or now likely a family like Murs was talking about probably would have their own CPA, full-time hired CPA. But let’s say that we don’t need that. We could get a CPA firm. Again, that comes back to the CFO who’s going to go out and he’s going to hire a CPA firm for the family that they need and manage that process. So you basically got this family office that’s managing all these different layers of businesses. So our core client that we work with typically does not have $100 million, $200 million, a billion dollars. And so what we talked about over the years is we would have conversations and say that atmosphere, everybody would love to have all that stuff organized for them regardless of their assets. But how can we do that and the assets not be there to manage it for one family, because we work with many families.
How do we set up a system so that we could offer that same experience that you would have in that type of place and do that for multiple people. So does that give you the link there? We got family office. Well, we’re not a family office because we work for more than one family. So what can we do? So we created, we’ve kind of used a different terminology I think in the past where we say we’ve got a team approach, but the reality is what this is is it’s an integrated wealth management experience. So what does that look like? What are the different aspects of that? Well, it honestly is exactly what we just described. Murs and I work as the CFO for our families, and then we go out and we have arranged all these different elements and manage that. Some of that we do in-house, some of that we go out and we work with partners.
So why don’t we tackle the first thing that I think is one of the most important aspects of this whole thing, is to me you’ve got wealth management, which is us that’s in-house. And then we’ve got this other side of the world over here that’s trying to take a part of our money, which is taxes. And if you could describe how we’ve put this together and what that looks like so that somebody could get a feel… And by the way you might have somebody else, we’re not trying to tell you if you’re listening to this and you don’t work with us, we’re not trying to say that we have it perfect, but here’s kind of our experience, what that looks like. So could you kind of lay out what our in-house versus what we’ve actually kind of partnered with?
Murs Tariq:Sure, yeah. The in-house or for wealth management, so we hold ourselves as advisors. We hold ourselves because of our CFP designation, certified financial planners. We’re also held out as fiduciary, so we have to put our clients’ interests first. A big part of what we do here and the core client that we attract and that listens to this podcast is someone that’s close to retirement or already retired. And so a big thing that we really focus on is the retirement focused financial plan. We believe that everyone needs that regardless of asset size. And that helps us see in a simple manner, Hey, here’s where we are today. Here’s our goals and here’s how things play out. And there’s a lot of things in between, but that’s the gist of what this plan is, that it gives us the ability to see, hey, is the plan going to work the way it is?
Or do we need to put some efficiencies in place? Do we need to think about opportunities and alternatives? Are we on track? Do we need to make changes? So that gives us really the beginnings and an overview of how retirement is now going to shape out. Once we have that in place, then we get to go down the route of, well, how do we achieve this financial plan that we’ve just discussed? Part of that is, well we need to invest for return and we need to invest for a return that is comfortable with the client as well. And so we’re talking about risk. We’ve also managed that in-house. If you’ve been listening to our podcast, that we have a specific approach when it comes to managing money in the market and also managing money outside of the market. And so those are two elements that we manage that whole process in-house.
The third element, so we’ve got retirement financial plan, then we’ve got the investing process specific to our client in a really well risk managed philosophy. The third piece is now tax planning. We do some of this in-house, but some of this we also outsource to get checks and balances in place. So tax planning, and again we’re not just making sure that we file taxes. Tax planning is really saying, Hey, what’s the tax situation look like today before the end of the year, and what changes could we make? What things should we look at before the year calendar year flips over? And then also, yeah, the next year we want be able to look at whether or not we are going to be involved in filing the tax return for the client. That’s where the CPAs come in. So that’s part of what we have partnered with some CPAs that we know and we trust to get stamps of approval on some of the tax planning ideas that we come up with as well as helping with the filing of the tax return if we get that far. You want to take it from here Radon?
Radon Stancil:Yeah. So I just want to recap here. So again, if a person going back to this family office, so now basically the person now in this part of the process, they have their money being managed. They don’t have to worry about what the investments look like. They don’t have to worry about where their income’s going to come from because they have a person that they’re working with that’s saying, where should I take money from? That is very closely connected to the tax part, meaning how am I going to get taxed on that? And then I’m going to make sure that I’m doing tax planning, tax strategy throughout the year, and then I want to make sure my taxes get filed. So that’s probably some of the most biggest things that people have to think about and worry about when it comes to their retirement plan. But again, we’re talking about a whole entire experience.
So what is the next biggest thing in our opinion that people need and that should be a part of this integrated wealth management experience? I think it would just go really quickly over to estate planning. And the reason why I think estate planning is so important is because if we don’t have things in place, it can make it very difficult for whoever we leave behind. That’s one aspect. There’s also the aspect of I want assets to go to people in a certain way, and then all of that needs to be managed and kept up to date. So if you look at our experience, the way we’ve done that is that we can basically, for our clients, have a system where they get all of their major documents for whatever state they live in put together. And that estate plan is developed, which includes things like a trust, a will, power of attorney, healthcare power of attorney, and a HIPAA form.
Now, we’ve done podcasts on all of those things and we try to keep you up to date, but now certain parts of that, and particularly the power of attorney, healthcare power of attorney and the HIPAA form, we believe should be updated on a certain number of years. As well as the will and things like that might need to be tweaked as well over say a six or seven year period. So let’s put a system in place where we’re just going to automatically do that. You don’t have to worry about it, think about it. It’s just going to happen. You know all of your documents are up-to-date because we’ve got a system in place to make sure that it’s done. So now think about this system so far, in this experience you’ve got all your wealth management taken care of, all of your finances, you’ve got all of your taxes, your tax planning, all that stuff done. Now you’ve got your estate plan done. Well there’s other parts of the system that are out there and that really would kind of tie into different aspects, but one that’s going to come up or one that might be coming up depending on your age, could be social security. So how do we deal with that one?
Murs Tariq:So social security can be simple and it can be complex at the same time, and in some cases it’s very simple. And the idea is we just got to run some numbers and help our client make the decision on social security, and when to take it and how to file for it. But sometimes it’s not that simple, it’s complex. And for that reason, we have a social security consultant on retainer with us that we tap into for her knowledge. She’s also been on this podcast, we’ve interviewed her a couple times. We’re going to interview her more, she’s a wealth of knowledge. And when we have more complex decisions to make, when we have more complex scenarios like a big age gap or one spouse is still working, or if there’s divorce involved or we’re trying to optimize for a certain type of income or we’re looking at survivorship, we’ll get her involved and say, ‘Hey, here’s the scenario for our client. Help us think through the pros and cons of taking it early versus taking it late and everything in between’.
And she helps us run the numbers as well. Again, because we’re not trying to hold ourselves out as the social security planning expert, we are in all essence the wealth management advisor here that’s trying to quarterback all the best partners that we can have to help our clients make the best decisions possible. And we’re okay with that. I’m okay not knowing every single piece about social security because we’ve got a great social security expert in our back pocket that we can tap into when we need to. And so she’s been great for helping us think through the best way to optimize social security. And it all comes back to what is the goal of the client.
Radon Stancil:All right, so that brings us down now to a bucket. That’s a big bucket, but I’m going to put them all together in one other part of this experience, and that is our insurances. Now, these things can get complicated again, but let’s just start with the one that is going to be crucial, and that’s health insurance. And particularly for a lot of our clients, they’re really looking at how do I deal with Medicare? There’s a lot of different options within Medicare. There’s all the different plans. There’s also Medicare Advantage. How do I deal with that? What do I need? And so we basically walk our clients through exactly how to do that. We have partners that we work with that can help us to analyze a person’s situation, to know whether or not they need, what type of plan is the best plan for them.
Really coupled right in there, by the way, is also [inaudible] back to the income planning. But how do I structure things so maybe I can reduce any kind of surcharges I might get through IRMAA with that plan as well. But also continuing to review those plans every year part of the year is what’s called open enrollment. We’re about to enter that into the last part of the year going into the first part of the year, and that allows you to move from one plan or one company to another without having to go through underwriting. So that’s a really important time to do a review of your Medicare insurance. So that’s one topic. Another topic under there that I think is really big as well is long-term care planning. We just did an episode on the podcast about that. And then there are opportunities from a financial planning as well as legacy planning that could play under life insurance.
So you can see why a family office would be so attractive and yet why a high net worth person would have all those things in place. So that’s what we’ve tried to design. We’ve tried to put together an approach really so that you can have peace of mind, not have to worry, not have to think about all those things and go find them. What are some other things? I think Murs just to kind of, how would it work if somebody called up and they said, what would the experience be like if they said, ‘Hey, I need help in one of these areas’. If they called up a client, a current client called up. If you think about that, are they having to go do a bunch of research themselves necessarily, or how does that get laid out to them?
Murs Tariq:Yeah. No, they’re not. The nice part is we’ve done a lot of the research. We’ve vetted a lot of the partners and we have a lot of confidence in the partners that we work with. Especially, depending on the category, we have quite a few different estate planning options internally and externally. Social security, we have a great consultant. Depending on insurance, we’ve got a few different avenues in which we go, some we do in-house and some that we would help you think through and put you in touch with the right person. But from the client perspective, what’s so nice about it is that we’re involved the entire time. So if it’s a question around long-term care, we’re quarterbacking that conversation with the long-term care specialist.
If it’s a question around social security and when to take it, we’re quarterbacking it. So we’re fully involved. And what’s nice about that is if the social security person gets back to the client, well, we know what they said to the client, and we’re able to be that soundboard with the client to say, here’s what the consultant said. Here’s what the experts said. Now let’s talk it through and make sure we’re all on the same page that we understand and we’re comfortable with this or that decision going forward. So the nice part of us being in the center and being the CFO that’s trying to make sure every aspect of your wealth management financial plan are in place, is that we’re involved and we’re in the loop with every little piece. So it makes it a nice, smooth and easy transition.