Julie Jason helps readers plan retirement and evaluate investment options for their lifetime earnings. Weekly
A trusted adviser and columnist, Julie Jason is author of the weekly syndicated column, “Retirement Planning and Investment.” Jason has been writing a weekly column for The (Stamford, Conn.)Advocate for the past 15 years.
A personal money manager, securities lawyer and award-winning author, Jason helps her readers assess investment risks and gains, guiding them to a more secure nest egg for retirement — no matter how early or late they start. Once a week, Jason’s column offers clear explanations of the basics of financial planning. In a world of often-confusing financial decisions about estate and tax laws, living wills, stocks and bonds, marriage and divorce, Social Security benefits, pensions and real estate, Jason helps readers navigate through the sea of options they have for investing their lifetime earnings.
Jason is a strong proponent of financial literacy for everyone, regardless of net worth. She approaches investing and writes about money in a way that hits home for everyone who works hard for his or her money – with a blend of optimism (everyone can do something to improve his or her financial situation), gentle humor and a healthy dose of skepticism (don’t invest unless you understand what can go wrong).
Julie Jason started her career on Wall Street as a lawyer after earning her advanced law degree from Columbia University. Her experience writing prospectuses and proxy statements helped her develop the critical eye and healthy skepticism needed for journalism.
Through the years, she has served as an arbitrator and a mediator for FINRA, the regulatory body overseeing the financial-services industry, and as a money manager focusing on the special needs of families approaching retirement for Jackson, Grant Investment Advisers, Inc., a firm she co-founded 20 years ago.
A strong proponent of financial literacy, transparency and investor protection, Jason writes and lectures on a variety of investment issues with analytical fervor and insights gained from her 30-plus years in the trenches. Her weekly column, which began its run in The(Stamford, Conn.) Advocate, has been recognized by the IRS for “accurate, timely, informative and helpful tax information,” as well as for “Excellence in Journalism” by the Society of Professional Journalists and the Connecticut Press Club.
Jason’s six investment books focus on helping readers improve their decision-making. Her latest release, “Managing Retirement Wealth: An Expert Guide to Personal Portfolio Management in Good Times and Bad” (Sterling 2011), introduces the topic of personal portfolio management; both it and her fifth book, “The AARP Retirement Survival Guide,” were recipients of the EIFLE Award (Excellence in Financial Literacy Education). Her books and articles have received a number of other awards for excellence in financial writing, including recognition by Booklist (American Library Association/“Top Ten Business Book” for 2010) and by the New York State Society of Certified Public Accountants for Excellence in Financial Journalism.
Through the years, Jason has addressed national and local television and radio audiences, and has spoken to the AARP national conventions in 2011 and 2012. Jason has taught investment principles to members of the general public as well as attorneys and accountants, and has participated in tax dialogues on a national level as the state of Connecticut’s representative to the Taxpayer Advocacy Panel (TAP), a federal advisory committee to the IRS, receiving President Barack Obama’s Call to Service Award (2009) in recognition of more than 4,000 hours of TAP service.
When I was having lunch with a client the other day, he suggested I continue the subject of last week’s column on safe withdrawal rates — how much someone can safely withdraw from his investments without running out of money.
His point was: “Julie, don’t assume that column readers who are approaching retirement know how to assess the financial advice they are getting at this critical decision-making time of life.”
The role of the adviser can be influential. Indeed, “households do not make decisions in a vacuum. … One particularly important source of inputs comes from financial advisers,” according to “The Market for Financial Advice: An Audit Study” (2012), co-authored by Sendhil Mullainathan of Harvard University, Markus Noeth of Hamburg University, and Antoinette Schoar, the Michael M. Koerner (1949) Professor of Entrepreneurial Finance and chair of the finance department at the MIT Sloan School of Management.
In an Oct. 27, 2016, article Schoar wrote for The Wall Street Journal on the Department of Labor’s new fiduciary rule, she made these additional points:
First, “[M]uch research shows that a large fraction of the population is poorly prepared to make these financial decisions by themselves.”
Second, “Typically, when faced with complex and important decisions we rely on trusted experts for advice. Sick people turn to doctors, those accused of crimes seek the help of lawyers, and the list goes on. These cases all have a common feature: The expert adviser must abide by a strict code of conduct that puts the interest of the client first. Surprisingly, the same is not always true for financial experts who advise people on their retirement savings.”
Third, “By the time you learn whether a retirement strategy was the right choice, it is usually too late to change it.”
When we talked about safe portfolio withdrawal rates last week, we discussed doing a self-audit of cash flows, longevity, inflation, taxes and the like. The rationale was to lay the groundwork for a plan of action — but it also is a guide for assessing a financial adviser or the recommendation of a product, such as a retirement income annuity or even a lump-sum distribution from a pension plan. An adviser who recommends a course of action without first fully understanding your circumstances and needs may not be prepared to provide the best solutions.
In addition, there is the “quality” of advice. In professor Schoar’s words: “[T]he majority of brokers are not paid on the basis of the quality of their advice, but rather on the fee income they generate from their clients. To resort to a medical analogy, this is equivalent to simply prohibiting doctors from recommending drugs that kill you, while not actually requiring they prescribe the best drugs to cure your disease.
“The world we live in asks us to make an abundance of financial decisions every day. These range from the inane, such as whether to risk a parking ticket when you stop for one minute to drop off your dry-cleaning; to the highly complex, such as which funds and investment products to pick for your retirement savings.
“All of these decisions require risk-return tradeoffs. Unfortunately, while people have many opportunities in life to perfect their strategy concerning parking tickets, the same is not true for the complex and all-important decisions of how to invest retirement savings.”
So, how do you know if the adviser’s input can help you make better decisions for yourself at the critical time period before you retire?
While it may seem simplistic, this is the bottom line: Be skeptical.
Advisers are not all equally equipped to handle retirement investing; methodology, strategy and experience with down market periods in particular are essential. There has to be a special respect for the vulnerable early stages of a retirement portfolio when a sharp downward move in the market can cause irreparable damage. The adviser has to have experience working with clients like you.
Interview a number of advisers to assess expertise. Hire the adviser whose self-interest is aligned with yours; if incentives drive an adviser to provide recommendations that are self-serving, go elsewhere.
We will continue to see a lot more media attention on self-interest and the fiduciary standard for retirement plans as we get closer to the implementation of the DOL’s new rules in the spring. We’ll talk more about the subject in future columns.
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Julie Jason, JD, LLM, a personal money manager (Jackson, Grant of Stamford, Conn.) and award-winning author, welcomes your questions/comments (readers(at)juliejason.com). To hear Julie speak, visit www.juliejason.com/events.
(c) 2016 Julie Jason.
Distributed by King Features Syndicate Inc