Every few weeks or so here at AgingOptions, we come across articles that promise to reveal the True Secrets of Retirement Success. This one, which we just found a few weeks ago at MarketWatch, is no exception. According to MarketWatch contributor Mark Hulbert, the single most important thing you can do to ensure retirement success is – ready? – to choose the right financial adviser.

Make no mistake: we agree with Hulbert’s contention that the choice of the person to guide you safely through the financial wilderness is highly important. But in our view, the notion that this choice is “the most crucial part of retirement planning” only reinforces the tired, old idea that “retirement planning” and “financial planning” are synonymous – when in fact a solid financial plan is only one component of the kind of truly comprehensive retirement plan which we call a LifePlan. But before we talk more about that, let’s see what Mr. Hulbert has to say in his MarketWatch article.

What Are You Really Looking For?

It’s all well and good to tell someone that they need to seek out the right financial adviser in order to ensure a positive retirement experience. It’s common advice (and too simplistic, we think). But the fact is, many retirees have no idea where to begin to look for the “right” someone to help them.

“We know this,” Hulbert writes, “because of the vacuity of the sales pitches used by advisory firms to get our retirement planning business. Because these firms often employ some of the top PR agencies on Madison Avenue, we can presume their pitches are effective. But given how little they really tell us, this means that retirees and near-retirees must be largely clueless.”

Ads for Advisers are Filled with Cliches

Hulbert proves his point by breaking down some of the more cliché statements these advisory firms make in their marketing pitches, especially on the radio. His issue with these statements isn’t that they’re bad, per se, but that they are incredibly vague and could come from any company. As Hulbert says, “There is no financial planning company in the country that couldn’t honestly embrace each of the following statements.”

These are real quotes from the actual radio ads of financial planning firms:

• Tailored financial advice for a life well planned
• It’s not just what you earn, it’s what you keep
• Allowing you to stop focusing on saving, and instead focus on living
• It’s never too early to think about retirement
• If there’s one thing we all share, it’s that our lives are all unique
• So you can live your life
• A lifetime of dedication deserves income for life

Sound great, don’t they? They’re so positive and encouraging! Hulbert calls them “superficially plausible” and “entertaining”, but they just aren’t realistic. They don’t reflect the nitty-gritty of what financial planning is all about.

The Relationship Between Adviser and Client is Personal

Hulbert argues that financial planning is, at its heart, about relationship, not money. That’s what most common marketing tactics around this industry get wrong. As his article suggests, you can’t mass-produce relationship, no matter how much companies might want to.

Hulbert draws a parallel with the relationship between a therapist and their client. “There are dozens of different theories, modalities, and systems that therapists use to describe their approaches. But, in the end, the research suggests, what is therapeutic about therapy is, above all else, the relationship with the therapist.”

When it comes to so-called robo advisers, Hulbert admits he’s not a fan. “It’s not that they are unable to provide us access to an enormous amount of valuable information that’s relevant to retirement planning,” he writes. “But they can’t satisfy the crucial role played by personal relationships with a trusted adviser. In the end, I believe there is no substitute.”

What is Your True Risk Tolerance?

Risk tolerance is probably the single most important thing every retiree—or someone approaching retirement—needs to determine. It’s a tough thing to figure out without a lot of self-investigation, which makes the importance of a relationship with a quality financial planner difficult to overstate. The right adviser can help you determine what your appetite for risk truly is, not just what you think it is.

Unfortunately, a lot of people try to short-circuit this important self-exploration process by simply taking a risk questionnaire or survey. Every firm uses essentially the same basic questions, but they don’t really dig deep. Hulbert writes that they “ask questions like whether you worry more about not losing money or not making lots of money.” But he adds, “The problem is that few of us know how to answer these questions accurately.”

Hulbert admits that clients don’t actually lie on these questionnaires: instead, the problem is that we overestimate our strength and ability to stick with our goals, even in the face of financial adversity. And, frankly, most financial planners—95 percent, according to a survey by the American College of Financial Services—think that the questionnaires are qualitatively meaningless. Planners think of such tools simply as a shortcut to the information that they should get through genuine face-to-face conversation with clients. And individual investors agree, to the tune of 82 percent.

Nevertheless, the questionnaires still loom large in the financial planning world, even though their usefulness is dubious, at best. “It’s as though we are sleepwalking through the retirement planning process,” Hulbert writes, “engaging in lots of activity that in the end signify next to nothing.”

What Does Success Look Like?

According to Hulbert, the shortcuts really aren’t shortcuts at all. Risk tolerance isn’t something you find out in ten minutes or less. That’s why he places such emphasis on building a relationship with your financial planner, and taking the time to find one that is empathetic, trustworthy, and willing to help you achieve your unique goals. “It’s only after a sometimes-lengthy process of exploration, with the guidance of a trusted and empathic financial planner, that we discover our true risk tolerance,” Hulbert says. “And only then can we begin to develop an appropriate financial plan.”

“Appropriate” is an essential word here. Everyone’s retirement plan is—and should be—unique, because every person’s definition of retirement success will be unique. “Success when it comes to devising our retirement financial plan is not judged according to rates of return,” Hulbert writes. “Instead, success is coming up with a plan that is suitable. That is not something that can be completely quantified.”

To underline his point, Hulbert quotes Benjamin Graham, the father of fundamental analysis. In his famous book “The Intelligent Investor”, Graham makes a startling statement: “The best way to measure your investing success is not by whether you’re beating the market, but by whether you’ve put in place a financial plan and a behavioral discipline that are likely to get you where you want to go.” In other words, a successful financial plan is more than just monetary achievement. It’s a lifeline to a retirement that serves you and your loved ones best.

Rajiv: Narrow Focus on Finances is a Ticket to Failure

We asked Rajiv Nagaich of AgingOptions for his view of this article. “The MarketWatch article does make a valid point,” says Rajiv. “You have to pick a planner who you really trust and can truly communicate with.” As Rajiv puts it, picking someone you found online or “someone who works with your buddy at work” is probably not the best strategy.

But on balance Rajiv remains unimpressed with Hulbert’s article, because, like most financial planners, Hulbert thinks financial planning is the “be-all, end-all” of preparing for retirement.  “This article is another narrowly-focused and misguided story about retirement planning,” he states. “You have to see financial planning as one piece of the retirement puzzle.” Failure to do so, he argues, is – to use Rajiv’s familiar term – “a recipe for disaster.”  Instead, people need to embrace LifePlanning, a comprehensive planning strategy where all the pieces truly fit together.

My Life, My Plan, My Way: Get Started on the Path to Retirement Success

At AgingOptions we believe the key to a secure retirement is the right retirement plan – yet statistics show that 70 percent of retirement plans fail. That’s why for nearly two decades we’ve been dedicated to the proposition that a carefully-crafted, fully comprehensive retirement plan is the best answer to virtually any contingency life may throw your way as you age.  Our slogan says it all: My Life, My Plan, My Way.

When it comes to retirement planning, most people focus on one fairly narrow issue: money. Financial planning is an important component of retirement planning. However, people heading towards retirement often make the mistake of thinking that a little financial planning is all that’s required, when in fact most financial plans are woefully inadequate. What about your medical coverage? What if you have to make a change in your housing status – will that knock your financial plan off course? Are you adequately prepared legally for the realities of retirement and estate planning? And is your family equipped to support your plans for the future as you age?

The best way we know of to successfully blend all these elements together – finance, medical, housing, legal and family – is with a LifePlan from AgingOptions. Thousands of people have discovered the power of LifePlanning and we encourage you to the same. Simply visit our website and discover a world of retirement planning resources.  Make certain your retirement planning is truly comprehensive and complete with an AgingOptions LifePlan.  Age on!

(originally reported at www.marketwatch.com)