Why Have a Personal Financial Blueprint? - Retirement Talk with Eric Kearney, Cape Coral, FL

Visit Eric Kearney at www.retirementwealthllc.com/
Episode 54
Retirement Talk with Eric Kearney in Cape Coral, FL. Eric Kearney is an author, a radio host, a fiduciary and Southwest Florida's premier investment advisor.
Joseph, I want to ask you a question obviously, because we are going to talk about the different stages of the personal financial blueprint. but the very first thing that you do, you like to show people their past rates of return. Right. Why is that so important? Their past rates of return? Right.
Well, every investor should be a student of history, looking at past market trends and incidences and trying to apply them to future ones in order to. A greater rate of return. So we're so interested in your three, five, and 10 year rates of return because now we have something to compare it to with the market.
And it's no secret that the past 10 years have been very good on the market. So if your portfolio hasn't been able to take advantage of this, then that's pretty worrisome because what if the next 10 years aren't as great? What if those are actually subpar? What's going to happen to your financial? Eric and I met with the client not too long ago, and we ran our personal financial blueprint for them.
They had been working with their advisor for quite some time now, and their 10 year rate of return came back at about 5%, which right off the bat was generally low compared to the overall market. But the thing was that their advisor, who they'd been working with for 10 plus years was telling them that all their annual review meetings, as long as we're getting a 7.5% rate of return, we're right in line with the financial plan.
So this meant one of two things. Either the advisor didn't even know how much his own portfolio was producing for his client, or he did, and he was too lazy to do anything about it. Mm-hmm. So this is exactly the type of service that we're trying to warn people about, because if you're working with an advisor, you deserve a lot more than just to be set and forgot about.
Absolutely. And Erin, I believe this next one is really huge, Joseph, obviously, how can you potentially reduce your risk while providing a better return for your clients? Right? So when we're building out this personal financial blueprint for you, we want to see exactly how aggressive you are, exactly how much risk you have in your portfolio, and we can start to determine which positions are making those too risky for you, and we can start to delete those positions.
And add in ones that are going to be much more fit with your financial plan. And over time you'll start to see the huge difference in the personal financial blueprint and in your portfolio that this effect has on you. Mm-hmm. So I think really reducing risk over time, especially after a year, like last year, when you can reduce somebody's risk while also taking advantage of the opportunities that the market is giving you, that's really the best way to get best of both worlds.
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