Published on 21, Mar 2023

Keith Gebert: How to Build Your Fiscal House

RightBridge Financial Group pioneers the financial blueprint strategy

Building a new house can be an exhilarating experience. The thought of designing your dream home from scratch, choosing every detail to suit your taste and needs, and seeing it all come to life can fill you with a sense of excitement and anticipation. From picking out the perfect plot of land to deciding on the layout, materials, and finishes, every step of the construction process presents a new opportunity to express your creativity and personality. The prospect of creating a space that is uniquely yours, tailored to your family's lifestyle and preferences, can be incredibly rewarding. As the project progresses and you see your vision taking shape, the excitement builds and the sense of accomplishment grows stronger. While building a new house may come with its challenges and obstacles, the thrill of seeing your dream home finally come to fruition makes it all worth it in the end.

Keith Gebert says that creating a financial plan is just like building a house.

As a Chartered Retirement Planning Counselor CRPC® and a Forbes Finance Council Member with a Certified Investment Management Analyst® (CIMA®) Certification from Wharton, Keith has the credentials and experience to know what he’s talking about.

“As with building a physical house, constructing a solid financial portfolio requires a well-thought-out plan that aligns with your long-term objectives,” he says. “We start off by establishing a timeline to achieve specific goals. For instance, stocks can offer a chance for greater returns, but they should be used over a longer period of time to counteract short-term losses. You’ll want to think about your retirement goals and factor in your present age, the age you wish to retire, and the income required at that point to fulfill your desired standard of living."

Adding insulation to your home

Risk management is similar to adding insulation to safeguard the walls, floors, and ceilings of your fiscal house against potential hazards such as market downturns or inflation. Risk management approaches and insurance products that can aid in these strategies include:

• Diversification: Spreading your investments across various assets, sectors, and geographies to reduce the risk of losses in one area.
• Growth: Investing in assets that have the potential to appreciate in value over time and outpace inflation, such as stocks or real estate.
• Liquidity: Holding a portion of your assets in liquid form, such as cash or short-term investments, to provide flexibility in case of unexpected expenses or emergencies.
• Cash Flow: Ensuring that you have sufficient cash flow to meet your financial obligations and avoid relying too heavily on debt.

Remodeling your fiscal house

“You can build a dream home, but still find yourself wanting to remodel from time to time,” Keith says. “Think about it - you loved that floral wallpaper ten years ago, but now you want something new and fresh. Your financial ‘house’ is the same. A great investment ten years ago might have changed. Your own goals and needs may have changed. You’ll want to review from time to time to make updates.”

Just as you undertake home remodeling projects to keep your living space up-to-date and functional, it's important to review your fiscal house strategies at least annually to ensure your portfolio remains aligned with your needs. An experienced advisor can assist you in determining what modifications are appropriate based on the objectives you seek to achieve. This may include evaluating your risk tolerance, adjusting your asset allocation, rebalancing your portfolio, and assessing the performance of your investments. Regular reviews and adjustments can help you stay on track toward achieving your financial goals.

The future of your home

“It’s important for us to educate our clients when it comes to planning what happens afterwards,” Keith stresses. “When you build a physical house, you think about what’s going to happen to it after your time living there is over. Your financial plan is similar. What’s going to happen to your wealth and assets after your life has ended? And in the meantime, how are you going to plan to use your retirement benefits wisely?”

The duration of maintaining your fiscal house depends on your life expectancy and the retirement income you require. Therefore, your fiscal strategy should incorporate sustainability elements to ensure that you don't exhaust your retirement assets too soon. Here are a few sustainability issues to consider:

• Coordinating your distribution plan with your Social Security benefits to maximize your retirement income.
• Repositioning your wealth with an IRA rollover to minimize taxes and take advantage of investment opportunities.
• Determining when to withdraw income from taxable or tax-deferred accounts to manage taxes and preserve your assets.
• Deciding when to take a lump sum instead of defined benefit pension benefits to ensure sufficient income for retirement.
• Minimizing tax implications associated with job income, required minimum distributions, and Roth IRA conversions.
• Utilizing products that provide a steady and reliable stream of income to support your retirement lifestyle.
• Ensuring that your surviving spouse receives lifetime income by incorporating strategies such as joint and survivor annuities.
• Leaving a legacy for your loved ones or charitable organizations through estate planning.

It is crucial to consult a team of professionals, including a financial advisor, insurance professional, tax professional, and attorney, as these issues can have significant tax and legal consequences. By understanding these issues and implementing appropriate strategies, you can achieve long-term financial stability and ensure that your retirement assets last throughout your lifetime.

“When constructing your fiscal house, you must begin with the foundation, because without a strong foundation, the house may crumble,” Keith states. “At RightBridge, we can help you create that strong foundation, so that your ‘house’ can last as long as you need it to.”