Navigating Your Retirement Future
Labeled the Great Recession, Americans have been told by experts that this most recent recession officially ended several years ago. But, for the average American, little has changed, and for those who have already retired or may be nearing retirement, the level of uncertainty they must navigate going forward remains at an all-time high. Ridiculously low interest rates on investments, nagging high unemployment rates, skyrocketing federal debt, huge stock market fluctuations, and rising health care costs are just a few of the many challenges facing existing and would-be retirees who hope to successfully navigate the uncertainties confronting them in what they had once seen as their golden years.
With few exceptions, most of us do not possess the required financial skills needed to create the type of comprehensive retirement planning necessary to successfully navigate life’s uncertainties. As a result, the majority of Americans enter retirement without the prerequisite planning needed to assure their financial futures.
This month Everything Knoxville is pleased to share with you its recent interview with Knoxville-based financial planner and president of Fritts Financial, Eric Fritts. Eric shares many of his thoughts regarding the financial uncertainties confronting each of us and possible strategies for moving forward.
EK: There has always been financial uncertainty in our lives. How has the most recent recession changed that equation?
Eric: This recession has been more complex than most. Most market corrections do not happen at the magnitude in which the last one did. The last correction happened quickly, too! This caused many government programs to be quickly implemented to try and stop the bleeding and fuel the recovery.
The good news is we hit all-time market highs around the middle of the year and have been continuing to climb since then. The uncertainty comes from all the government programs and aids that have been put in place to get us there. We have yet to see what long-term effects this will have on our economy. Oftentimes the best intentions have unappealing trade-offs, such as low interest rates for investors.
Uncertainty is nothing new. We are just confronted with a higher level of uncertainty at the present. This should not prevent us from participating in investment strategies to help us obtain our goals and objectives. We should, however, make sure our strategies are well thought out and monitored closely.
EK: What would you say is the biggest mistake being made by many of us who are attempting to secure our retirement future?
Eric: I would say not working with an advisor who specializes in working with people who are in whatever phase of life they’re in. You have to understand that, during your accumulation phase of life, your investment strategies should be very different than they are during your preservation and distribution phase. I see many retirees and advisors alike who believe a slight shift in asset allocations is all that needs to be considered once an individual retires. Do that, pick a time to start taking social security, get your Medicare, and then start sipping Mai Tais on the beach. They do not understand the ins and outs of a cohesive retirement strategy and all the different aspects that need to be considered. Oftentimes it’s because they are not working with an advisor who is experienced in this highly specialized field.
EK: Do you feel the average American waits too long to begin planning for retirement?
Eric: Absolutely. With most employers completely phasing out pension and defined benefit plans, pulling back on 401(k)s and defined contribution plans, and the long-term sustainability of social security being questioned, it’s extremely important for people to take responsibility of their retirement future. The earlier you start to plan, the better off you’ll be in the future.
EK: You are younger than most financial planners. How does that benefit your clients?
Eric: I would say the first benefit would be my ability to think outside the box and adjust to new circumstances. Many advisors get stuck in their ways, stuck in their recommendations, and do not adapt to an ever-changing and evolving investment environment. As soon as you become comfortable, you become average. My youthfulness combined with seven years of experience is a benefit in itself. When you couple that with the fact I work with an advisor who has 30 years of experience and who happens to be my father, it provides the best of both worlds for our clients. When experience meets innovation, great things can happen!
The second benefit is the expectations of a younger advisor are always higher, and I get that. If I can’t offer my clients better customer service, create better relationships, gain a better understanding of what things are important to them, and so on, why would they choose to work with me instead of a 20 or 30 year veteran? The answer is they wouldn’t. This drives me to continuously be the best I can be. Not only because I want to, but also because I have to!
EK: Tell us a little about Fritts Financial.
Eric: As I mentioned, I work closely with my father, Richard Fritts, who is the founder of Fritts and Associates. I launched Fritts Financial about two years ago to bring a specialized set of services to our firm. Fritts Financial offers high-end, fee-based asset management to our clients. For the investor who does not want all their assets in the traditional “pie chart portfolio,” I bring unique management philosophies and strategies to the table. The goals and objectives of our fee-based platforms are different than most, but they seem to be consistent with what our client base is looking for.
EK: You mentioned the client base you work with. Tell us a little more about that.
Eric: We specialize in working with pre-retirees and retirees ages 55+ with more than $250,000 in investable assets. It has never been our goal to be some things to all people. Instead, we have structured our firm to be all things to some people. People nearing or in retirement have very different goals and objectives than others, and their investments and plan designs should reflect that. That’s where we come in!
EK: Help our readers understand your unique approach to financial planning. How is it different?
Eric: We are a full-service financial planning firm capable of a wide variety of services. We have three advisors in our office who each have their own skill sets, areas of focus, and, most importantly, they are all three independent. This is extremely important for our clients, because they know we are going to recommend the best investment options we can find, not what our home office or brokerage firm is pushing! If you are seeking safe and secure investments in your portfolio, we have one of the most knowledgeable professionals in the area in-house. With fixed rates and interest bearing vehicles paying historically low rates, a specialist who knows where to find the best options becomes very important.
If your preference is to incorporate stocks, bonds, or mutual funds into your portfolio, we have an independent broker to help our clients acquire the best investments in those categories. We have access to some of the nation’s most well suited private wealth management platforms for our clients. We also offer estate planning advice and coordinate with clients and attorneys we work with to make sure all puzzle pieces align correctly. We work closely with a high-end local CPA firm and have a working relationship with a Social Security Consultation firm that consists of a CPA and retired social security administrator. You could basically say I act as a quarterback for a very strong team we have put together for our clients. Very few firms are structured this way, but we feel the value is priceless.
EK: How can our readers learn more about Fritts Financial?
Eric: You can start by visiting us online at www.FrittsFinancial.com, or follow us on our Fritts Financial business page on Facebook. If you would like to receive our weekly newsletter via email, just send us an email to email@example.com and request to be added to our list. We’ll share market updates, tax savings tips, and other news that we believe will be beneficial and interesting to you. Also, we offer a variety of educational workshops throughout the year you may elect to attend. But the best way to learn more about us would be to call the office and set up a time to come in and talk to us. You can sit back, enjoy a cup of coffee, and we can get to know each other.
EK: In closing, is there anything else you would like to share?
Eric: It’s all about relationships. A lot of people say it, but why is it important? If you develop a strong relationship with clients based upon open and honest communication and education, fiscal prosperity becomes very obtainable. Relationships are vital to long-term success when it comes to working with any advisor. Success is the result of strong personal relationships, an understanding of the client’s goals, trust, and honesty. For me, success is helping others achieve their investment and retirement dreams.
112 Glenleigh Court, Suite 3
Knoxville, TN 37934
Investment advice is offered by Horter Investment Management, LLC, a Registered Investment Adviser. Insurance and annuity products are sold separately through Fritts Financial. Securities transactions for Horter Investment Management clients are placed through Pershing Advisor Solutions, Trust Company of America, Jefferson National Monument Advisor, Fidelity, Security Benefit Life, and FC Stone.