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The Benefits of Consolidation

Typically, we did not meet our clients until they were retired or were seriously considering a date to retire. It was common for them to have savings, investments and benefits at several financial institutions. One of our objectives, through integrated planning, was to coordinate, consolidate and simplify their affairs. Better planning, no conflicting advice, less confusion, more control over income flows, more efficient asset allocation and tax planning, fewer statements, simpler administration – and finally, more orderly, expedient and less costly wealth transfer to beneficiaries or the estate.

Consolidating your assets facilitates three keys to managing your investments effectively:

  1. Capital Preservation – protecting the value of your assets while investing for growth and income.
  2. Cost of Investing – enhancing your returns by controlling investment management fees.
  3. Tax Efficiency – reducing the tax you pay by such measures as controlling clawbacks, splitting income, or tax-efficient investing can go a long way to creating more spendable income.

Putting It All Together

A financial plan may include one or all of the following components. Sometimes, it is a huge step just to identify the various issues that should be addressed:

Retirement Income

  • When do you plan to retire?
  • What kind of retirement plans/pensions do you have? What are the assets? How are they invested?
  • Do you control asset allocation and investment decisions? Do you have an Investment Policy Statement?
  • What government benefits can you expect?
  • How will your income requirements change at different stages of your retirement?

Health Risk Management

  • How will health issues impact your retirement plans?
  • Do you have Critical Illness and Long-Term Care insurance for you and your spouse?
  • What arrangements will you make for home care or long-term care, if required?
  • Who will deliver care? Where will you live? What support will you require?

Assist Children

  • If you are able, how would you want to financially assist your children?
  • Are there any special needs or circumstances to consider?
  • Have you established plans for education funding? Inheritances? Gifts of money or property?

Assist Parents

  • How is your parents’ health?
  • What kind of assistance will they require as they age?
  • Have you made any provisions for their healthcare? Will you need to cover any of the costs of care?
  • Have they done any estate planning?

Estate Plans

  • What is the primary goal of your estate plan?
  • Do you have a living will? A durable Power of Attorney?
  • Have you identified the executor and principal beneficiaries of your estate?
  • Are you establishing testamentary trusts? What are the trust provisions?
  • Do you plan to make gifts to charity?
  • Do you own life insurance? For what purpose? Are you confident you have enough?