Dr. Wade Pfau and the RISA Plan

Dr. Wade Pfau is a world renowned expert in the field of investing and he joins Marc Rogers and JAG today on the podcast.

Challenges in Retirement and Modern Solutions

We start the show talking about some of the major challenges retirees face today in an ever changing world, and how you, as an advisor, can best be equipped to help them. This includes sequence of return risk in our current stock market, bond market, and inflationary economy. Also longevity risk: we are living longer and don’t know how long the money will need to last.

Dr. Wade Pfau and the RISA Plan

Investors no longer fit into one of five cookie-cutter strategies. That’s where Dr. Pfau’s RISA Plan comes in. It stands for Retirement Income Style Awareness. This starts with a “probability based” vs “safety first” mindset analysis. Next is “optionality” vs “commitment.” The RISA Plan it helps you determine everything about your investors’ risk tolerance and planning mentality. And interestingly, investors’ results from the RISA plan do not tend to change with market or economic conditions, as the research showed between March and September of 2020.

Wade explains how advisors can employ RISA to best serve their clients. Knowing how clients answer these questions ahead of time gives you a knowledge of their retirement style as well as how they want to implement financial advice, which can make for a better introductory meeting. Also, as an advisor, you may have worked with one line of thinking when it comes to retirement planning your whole career. This may open your eyes as to how to work with investors who have a different style. It’s all about getting investors into a strategy that they will be comfortable with into and throughout retirement. Dr. Phau explains that may include both investments and insurance. This leads Marc to ask him about the “bad rap” that annuities often get.