Considering a financial advisor? Ask questions first

The financial advisors at Member Benefits can help you anticipate your future tax liability, get a real picture of your assets and challenges, and help you make necessary changes now before you retire.

However, it’s important to ask questions before trusting someone to advise you on your financial future, such as:

Start your financial advisor search with BrokerCheck, a free tool to research the background and experience of financial brokers, advisors, and firms. Get a snapshot of a broker’s regulatory actions, investment-related licensing information, complaints, and more.

Visit brokercheck.finra.org or call their helpline at 1-800-289-9999.

To schedule an appointment or learn more about Member Benefits’ financial planning services, call 1-800-279-4030, ext. 6730 or weafa@weabenefits.com.

Learn more by reading our article, A recipe for retirement.

A recipe for retirement

We wish it were easier, but in reality a lot goes into planning for retirement. It’s like hosting a holiday meal—you need to plan for how many people are coming, what you’ll serve, the ingredients you need, and the timing of the food. You know that some preparation and organization are going to be necessary to make the meal a successful one.

Much like coordinating a holiday meal needs a recipe for success, so does retirement planning. The recipe isn’t the same for all, but there are several common ingredients that most everyone should include as they create their plan.

Here are some of the ingredients for creating a delicious retirement.

Prep early

The earlier you start saving, the more you can take advantage of compound interest. Compounding is what happens when earnings on your investments are reinvested in your account. The reinvested earnings may also have earnings and then those earnings are reinvested and so on. Compounding can have an amazing impact on your retirement savings.

However, it’s never too late to start saving. Saving even a small amount each month is better than nothing. But the sooner you can, the better.

Dish up your savings options

If you’re not saving in your district’s 403(b) program, you may want to get started. Your savings receive advantageous tax treatment, and your district may kick in more through a match.

Member Benefits’ IRA program is also a great savings option. It gives you the opportunity to save for retirement outside of employer-sponsored retirement plans.

Blend in this fact: More spending in the future requires additional savings today.

You need personal savings to help fill any shortfall in your retirement income that may not be satisfied by your Wisconsin Retirement System (WRS) pension plan and Social Security benefit. As life expectancy increases, saving more is becoming increasingly important. According to the Centers for Disease Control and Prevention, the average life expectancy for a person who was 65 years old in 2018 is 85.7 years for women and 83.1 years for men—and life expectancy for both genders continues to increase. And as of 2021, one out of three 65-year-olds today will live past 90, according to the Social Security Administration.

Put your personal retirement contributions on autopilot through payroll deduction or monthly automatic withdrawals from a checking or savings account to make it easier to save. Your options with the 403(b) and IRA may differ, so check with your specific plan.

And don’t forget to increase your savings contributions on a regular basis. We have more information on annual contribution limits.

Measure up your savings goals

What do you want to do in retirement—travel, shop, golf, start a hobby? Do you plan to purchase a home or help your kids out financially? More spending in the future requires additional saving today. Be realistic about the price tags of the things you want to do knowing that the cost of living will continue to increase and that you may live longer than you expect.

Member Benefits has an array of free financial calculators that can help you as you clarify your retirement goals.

Mull over fees

You wouldn’t willingly overpay for food, so take the same approach with your retirement account. Costs matter, and you need to understand all of the fees involved. Our fees are simple—a Member Benefits IRA or 403(b) has one low annual administrative fee with an annual fee cap. (Mutual fund management and redemption fees apply.)

To make the most of your invested dollar, you want to minimize the fees you pay. Ask questions of the retirement savings providers you’re interested in—they should be able to provide a clear and complete explanation of their program fees. Learn more about fees.

Proceed carefully

As the school year gets in gear, you may see more financial representatives in your building. Be wary of those who sell high-cost financial products that have additional layers of fees (sometimes hidden) for things like insurance, wrap accounts, etc. Sometimes brokers and insurance agents can benefit more from product sales than the client.

Because seniors are a growing segment of investors, financial services firms are increasingly focusing their marketing and sales of investment products on investors in or nearing retirement. One common marketing approach is to invite seniors to an investment seminar and offer them a free meal. Be on the lookout for exaggerated claims or guarantees that are often part of the enticement. If it sounds too good to be true, it probably is.

If you really want to go to one, do your homework before the seminar and don’t rush your decision—let it percolate a while. A good investment will be available tomorrow or next week or next month…when you are ready and when you understand exactly where your money is going. Ask plenty of questions so you know what you’re buying as well as the risks and costs.

And don’t let anyone tell you that you need to move your 403(b) or IRA with WEA Member Benefits somewhere else when you retire. You do not have to move your 403(b) or IRA account when you retire or change jobs…even if you change careers. We will still be here to serve you. You can stick with us up to and through retirement.

Let your retirement savings rest

Have you ever pulled out a roast from the oven and were so hungry you cut into it right away? Chances are it was probably drier or tougher than you expected because you didn’t give it a little time to rest first. Patience is a virtue in cooking as well as saving for retirement. Withdrawing early from your retirement savings can be tempting at times, but it should always be your very last resort. If you pull funds out early, you’ll lose principal and interest, and you may lose tax benefits or have to pay withdrawal penalties. You can borrow money for things while you’re working, but you can’t borrow money for retirement.

Avoid the pressure cooker: A good investment will be available tomorrow or next week or next month.

Cook up a plan for the unexpected

When preparing a holiday meal, sometimes the unexpected happens…like you thought the turkey would be thawed in time, or a relative invites “just a few friends” to join in at the last minute.

Preparation and flexibility are keys for coping with those situations as well as for retirement planning. Health care costs are a major consideration that many people underestimate. Fidelity’s 20th annual Retiree Health Care Cost Estimate reveals that a 65-year-old couple retiring this year can expect to spend $300,000 in health care and medical expenses throughout retirement. For single retirees, the 2021 estimate is $157,000 for women and $143,000 for men. And the COVID-19 pandemic has prompted many to accelerate their retirement plans, which means paying for health care insurance until qualified for Medicare.

Inflation and the uncertain future of Social Security are other factors to consider. That makes it all the more important to make personal savings part of your retirement plan.

If you find you’re more limited in what you can afford to do in retirement than you expected, you may need to be more flexible. It could be you need to delay retirement for a while, move to a smaller place or cheaper locale, or work a part-time job.

Fold in a flexible mindset when it comes to your plans and expectations for retirement.

This may also help you postpone claiming Social Security or cover expenses during a market downturn. Weigh out all the opportunities available to you. Staying active by working or volunteering can also be a great way to pursue an interest or gain a new one, meet new people, and remain socially connected and challenged.

Mix in a financial advisor

According to the Department of Labor, only 40% of Americans have calculated how much they need to save for retirement. That’s likely because it’s just not always easy. One of the most challenging aspects of creating a solid retirement plan is striking a balance between realistic return expectations and a desired standard of living.

The financial advisors at Member Benefits can help you anticipate your future tax liability, get a real picture of your assets and challenges, and help you make necessary changes now before you retire. For Wisconsin public school employees, it’s important to work with someone who has a thorough understanding of 403(b) savings accounts and WRS, such as the financial advisors at Member Benefits.

Sometimes a little help goes a long way. If you’re looking for guidance on whether your portfolio aligns with your current goals, or if you want to explore your tolerance for risk, decide on investment objectives, determine your retirement expenses and income, or discover whether you’re on track for retirement, we have a service for you.

Visit our financial planning page to learn more about our financial planning service options, or email weafa@weabenefits.com to get started.

Stay informed

No matter what your age, be sure to do your research and educate yourself using reliable resources. Member Benefits is an excellent place for retirement information. Visit our learning center to access articles, eBooks, calculators, informational brochures, an interactive budget worksheet, and more. And feel free to call us with your retirement questions at 1-800-279-4030.

Your recipe for retirement is personal and unique, just like Grandma’s special apple pie. If you pick up some tried and true ingredients and follow the recipe directions, you can accomplish your goals and create a satisfying retirement.


Your retirement recipe


Considering a financial advisor?

Ask questions first. Learn more about how to begin your financial advisor search.

Facing Financial Fears

Perhaps you fear your identity will be stolen or you’ll lose your job. Or it’s facing the looming questions: Have I saved enough? How do I create a budget and make it work? Here are several common fears and how to face them this Halloween:

I fear I may never get out of debt.

How to face your fear: The scariest part is identifying exactly how much debt you have and why. Once you’ve assessed your debt, devise a plan to pay off the smallest debt first. If you need some help contact our financial advisor. We’ll help you come up with a plan to get you back on track.

I fear bills and bank statements.

How to face your fear: Bills and bank statements are unavoidable, but don’t live in denial if you’ve gotten to the point of fearing bills and bank statements you’re probably overspending. Cut back don’t spend more than you make. Then build a budget and stick to it. We have tools and calculators to help you.

I fear my identity will be stolen.

How to face your fear: Be diligent. Monitor your credit reports, bank statements and transactions Sign up to receive text or email alerts from your bank or credit union if your financial institution offers this service.

I fear I haven’t saved enough for my future.

How to face your fear: It’s never too late to start! Contribute more. Pay yourself first and stick to your budget.

I fear I will lose my job someday.

How to face your fear: Prepare in advance. Establish an emergency fund and stash away at least six months of living expenses.

Remember, facing your financial fears doesn’t have to be scary. The key is to identify the cause of your fears and face them by taking action, making a plan, and being realistic about your situation.

Celebrating a Personal Investment Account anniversary

For years, you had been asking for a way to invest and/or keep your required minimum distributions at WEA Member Benefits—so we provided the Personal Investment Account (PIA) option. The PIA lets you invest your nonretirement money without using a cash account such as savings, checking, or certificates of deposit.

If you have a windfall of cash, an inheritance, proceeds from the sale of a property, required minimum distributions, or extra income you won’t need within the next five years or longer, a personal investment account might be for you. There are also tax benefits to these types of investments.

To learn more, give us a call 1-800-279-4030, or visit weabenefits.com/pia.

2018 Financial Mentor Award winners

Their comments speak for themselves:

“He meets with every new employee to discuss investment and savings plans in detail and spends a great deal of time assisting our staff with their financial questions and situations.”

“She is always helping other staff with their questions related to retirement and benefits.”

“She truly cares about the teachers in our district and helping them to make good choices. Her e-mail reminders, after school planning sessions, and personal conversations go above and beyond her call of duty.”

Congratulations to these exceptional financial advocates. You are appreciated for what you do!

Each winner was recognized in your$ magazine and will receive a personal certificate of recognition.

Don’t see your mentor on the list? 2019 Mentor nominations are now open at weabenefits.com/mentor.

How to choose a financial planner

Getting the answers to important questions up front will help you avoid surprises (the bad kind) later on.

Most people, however, don’t know what questions to ask. When you decide to start looking for advisors, you may find there are many to choose from. You can narrow down your list with some calls or emails asking a few basic questions.

What are your credentials? Designations are often listed after a planner’s name.

What exactly do you do? The term financial planner is ambiguous, so ask who their typical clients are and what their area of expertise is.

How do you get paid, and what will it cost me? Financial planners can be compensated in a number of ways.

Are you a fiduciary? Fiduciaries make a commitment to work in the best interest of the client. They cannot combine product sales with advice giving, and they must disclose how they get paid.

Once know who you’re interested in, it’s time to get more details. Both The National Association of Personal Financial Advisors (NAPFA) and the U.S. Securities and Exchange Commission (SEC) have developed lists of questions that you can use when interviewing candidates.

NAPFA’s consumer resources page has some great tips and tools for choosing a planner. We suggest giving a copy of the NAPFA “Tough questions to ask your advisor” questionnaire to each candidate to fill out. This will make it easy to do a side-by-side comparison and those who don’t want to fill it out can quickly be eliminated from your pool of prospects. In fact, there may be good reason they don’t want to answer some of the questions.

The SEC website provides questions to ask that are specific to investment products as well as the people who sell them. Plus, you’ll find good information about the 403(b) and what to look for when choosing a provider.

Is this you?

If you answered YES to any of the above, you may benefit from our variety of free and fee-based financial planning services that are geared for Wisconsin public school employees and their financial needs. Discounts are available for 403(b) participants and WEAC members.

(View program disclosures.)