PARSIPPANY, N.J., March 13, 2015 /PRNewswire/ -- Without a doubt, "Will I be Okay?" is the most frequently voiced concern we hear when we are working with surviving spouses—especially those who were not the family's primary breadwinner. Fears stemming from financial uncertainties are usually a huge source of insecurity and stress during the difficult period of time after the loss of a spouse. As a result, qualified professional wealth managers must channel all their technical and interpersonal skills to support, manage, and guide a widow as she embarks on her journey forward to gain clarity regarding her financial well-being and regain control of her life.
To succeed in this endeavor, it is critical that the professional wealth manager not allow this emotional question to obscure the widow's focus on the three key questions that she really needs to have addressed. Talented wealth managers quickly move the conversation to the real issues at hand.
First, "Do I have enough?" It is very tempting for even seasoned professionals to dismiss the need for a detailed accounting-based analysis and instead pencil out a back-of-the-envelope calculation. But shame on them if that's what they do! Whether a client is worth $10 million or $100 million – and whether they spend $100,000 or $1 million a year – the benefits of a well-laid-out cash flow analysis that paints a clear picture of the client's financial landscape for the remainder of her life cannot be underestimated. When we walk our clients through a variety of "what if" analyses that include alternatives and answers, the shift in their visage – from one of pent-up stress and tension to one of relief and calm – is often palpable as their sense of security is restored.
Second, "Where will the income I need to live off of come from?" This is a question we always address for our most sophisticated retiring corporate CEOs and company presidents who are blanketed with layers of pension, retirement, deferred compensation, and incentive income. Surviving spouses deserve – and get – nothing less; we ensure that they have a well-constructed income strategy, something they can count on as a financial foundation upon which they can gradually build their life and lifestyle around. The key here is to simplify both the build-out and the ongoing management of each tailor-made income strategy. The right advisor will take it upon himself or herself to review all components of the income strategy and overall cash flow to ensure it's continuously functioning smoothly.
Third, "Can I afford to gift money to my children and grandchildren, and support charitable causes that are important to me?" We always begin by emphasizing that our primary commitment is to secure our clients' quality of life. Once that is done – with a very high degree of certainty and a healthy dose of contingency planning – then gifting initiatives of various sizes can be considered. Careful thought in this area can also produce indirect collateral benefits. For example, by heavily subsidizing college funding for a client's grandchildren or placing a vacation home into a family trust, the client can even pass on family values and take an active role in weaving the economic fabric of future generations.
After being married to a person and building a successful estate with them over the years, odds are life didn't become simpler, it became more complex. Compound that with the loss of your life-partner and the inescapable realization you now need to wisely manage all this complexity on your own… Engaging the best suited and most competent wealth management team is a critical step in the right direction.
Steven W. Lieberman is the founder and Managing Director of The Private Client Group at Summit Financial Resources, Inc. – one of the largest independent financial planning and wealth management firms in the Greater New York City Area.
The Private Client Group's founder and Managing Director, Steven W. Lieberman, provides securities and investment and advisory services through Summit Equities, Inc., Member FINRA/SIPC, and financial planning services through Summit Equities, Inc.'s affiliate, Summit Financial Resources, Inc. 4 Campus Drive, Parsippany, NJ 07054 20150312-0303
SOURCE The Private Client Group