Key Takeaways
- • Buy Side's WSJ-published evaluation names Retirable, Facet and Mercer Advisors as 5-star firms for meeting retirees' needs, with Creative Planning (comprehensive wealth management) and Aspiriant (lower AUM fees) also singled out.
- • Retirees need advisors who can manage retirement income, minimize taxes, address insurance and Medicare needs, and build estate plans, per the article.
- • The article advises prospective clients to confirm advisors have retiree-specific experience, hold a fiduciary standard, and ideally hold credentials such as the CFP designation.
- • Fee structure matters: a 1% AUM fee on $1 million costs $10,000 a year versus a $15,000 flat fee, but at $5 million the flat fee is cheaper at $50,000 for the AUM fee.
- • Chuck Henrich of Southwest Michigan Financial, LLC identifies generating lifetime income from savings as the top advisor priority for retirees.
Summary
A Wall Street Journal guide, prepared with Buy Side's evaluation of financial advisory firms, profiles five firms it considers well suited to retirees: Retirable (best for easy retirement income management), Facet (best flat-fee advisor), Mercer Advisors (best for high-net-worth retirees), Creative Planning (best for comprehensive wealth management) and Aspiriant (best for lower AUM fees). Retirable, Facet and Mercer Advisors each receive five stars in the analysis.
The article emphasizes that retirees face a range of responsibilities, including required minimum distributions, Social Security timing, Medicare, retirement income taxation and estate planning. According to Chuck Henrich, president and owner of Southwest Michigan Financial, LLC, the primary task of a retiree advisor is generating lifetime income from a nest egg alongside Social Security or pension income. Henrich also cited couples paying $1,500 to $2,000 a month for healthcare as a significant drain on retirement savings.
On selection criteria, the article recommends asking whether an advisor is always a fiduciary, reviewing credentials such as the CFP designation, which the CFP Board says is held to a fiduciary standard, and considering retirement-specific designations such as RICP and RMA. Registered investment advisers are legally required to act as fiduciaries, while some dual-registered professionals are not always held to that standard. Investors can verify registration and disciplinary history through FINRA BrokerCheck and the SEC's Investment Adviser Public Disclosure site.
On fees, the article notes that commission-based advisors carry conflicts of interest, while fee-only advisors can still face incentives tied to AUM fees. Using an example, a 1% AUM fee on $1 million equals $10,000 annually, below a $15,000 flat fee, while on $5 million the AUM fee rises to $50,000, making a flat fee cheaper. The article also states that an advisor is not necessary for retirees with simple finances, such as a predictable pension, or those comfortable managing their own investments.
The article emphasizes that retirees face a range of responsibilities, including required minimum distributions, Social Security timing, Medicare, retirement income taxation and estate planning. According to Chuck Henrich, president and owner of Southwest Michigan Financial, LLC, the primary task of a retiree advisor is generating lifetime income from a nest egg alongside Social Security or pension income. Henrich also cited couples paying $1,500 to $2,000 a month for healthcare as a significant drain on retirement savings.
On selection criteria, the article recommends asking whether an advisor is always a fiduciary, reviewing credentials such as the CFP designation, which the CFP Board says is held to a fiduciary standard, and considering retirement-specific designations such as RICP and RMA. Registered investment advisers are legally required to act as fiduciaries, while some dual-registered professionals are not always held to that standard. Investors can verify registration and disciplinary history through FINRA BrokerCheck and the SEC's Investment Adviser Public Disclosure site.
On fees, the article notes that commission-based advisors carry conflicts of interest, while fee-only advisors can still face incentives tied to AUM fees. Using an example, a 1% AUM fee on $1 million equals $10,000 annually, below a $15,000 flat fee, while on $5 million the AUM fee rises to $50,000, making a flat fee cheaper. The article also states that an advisor is not necessary for retirees with simple finances, such as a predictable pension, or those comfortable managing their own investments.
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