By Rachel Christian, Bankrate

The road to retirement is full of twists and turns. You might think you’re on the right path, but life can throw unexpected obstacles in your way that derail even the best laid plans.

Numerous variables are at play, from how long you might live to how much you’ll receive each month from Social Security. A few wrong calculations, and you run the risk of outliving your savings. You might envision retirement as a great escape from the daily grind, but planning it can feel daunting.

Financial advisers help you tackle the many aspects of retirement planning by offering personalized recommendations based on your situation. But is hiring one of these professionals worth the cost? After all, a 1 percent fee on your total assets under management is common, while a comprehensive financial plan can easily cost $1,000 or more.

Here’s what you should consider when weighing the financial pros and cons of hiring a financial adviser for retirement planning.

What is retirement planning?

Retirement planning is the process of preparing and organizing your finances to ensure a secure and comfortable lifestyle after you stop working.

It involves setting financial goals, estimating the amount of money needed for retirement and creating a strategy to achieve those goals. This includes saving money in retirement accounts, such as 401(k)s or Roth IRAs and investing wisely to grow your wealth over time.

Well-executed retirement planning also considers factors such as Social Security benefits, rising health care costs and tax-advantaged withdrawal strategies. Regularly reviewing and adjusting your plan is also necessary.

In short, the goal of retirement planning is to build a financial cushion that allows you to cover essential expenses and enjoy your post-working years with peace of mind.

Benefits of working with a financial adviser

Financial advisers bring a wealth of knowledge and experience to the table. Navigating the complex world of retirement involves understanding investment options, tax rules, government programs and market dynamics to name a few. Instead of spending hours researching and learning about new topics, you can turn to a professional who can answer your questions and provide clarity in a matter of minutes.

One of the biggest benefits of working with an experienced adviser is gaining insights and strategies that may not be readily apparent to someone without a financial background. A qualified adviser can help you pick the best investments for your portfolio based on your financial situation, goals and risk tolerance. Their knowledge helps optimize your investment performance, ensuring a balance between growth and risk mitigation.

Saving time is another benefit. An adviser can monitor and tweak your portfolio as needed, then meet with you once a year to review its performance and address any other financial goals or concerns. This frees you up to focus on your daily life without neglecting your retirement plan in the process.

Finally, advisers take a holistic look at your finances, which can uncover less obvious ways to save money. For example, an adviser can help you shop for long-term care insurance so you won’t risk deleting your nest egg late in life. Or if you’re inclined toward philanthropy, an adviser may suggest a donor-advised fund as a tax-advantaged way to donate to your favorite charity.

The cost of DIY retirement planning

You might feel confident mapping out your own retirement plan — after all, there are a lot of online resources at your disposal. It might also feel counterintuitive to pay for advice when your primary goal is saving money for your future.

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But the truth is, making simple mistakes when planning for retirement can cost you a small fortune down the road. Getting an unbiased outside perspective can pinpoint overlooked details or raise questions long before you exit the workforce — and when you still have time to make corrections.

Without an in-depth understanding of financial markets, tax codes and investment strategies, you may find yourself making decisions based on gut instinct or advice from family and friends.

One way financial advisers provide value is by optimizing investment returns. By using extensive market research and analysis tools, they can identify investment opportunities aligned with your goals and risk tolerance, potentially maximizing the growth of your retirement assets.

When it comes to saving money, financial advisers can also recommend cost-effective investment options and affordable retirement accounts. This can lead to significant savings over the long term, preventing high fees from eating into your investment returns.

Money can be highly emotional. A drop in the markets can feel like a punch in the stomach, especially if you’re nearing retirement. Emotions can cloud your judgment, leading to impulsive decisions about buying and selling investments. Advisers act as a rational third-party who can help prevent knee-jerk reactions that might cost you thousands of dollars in the long-term.

Is hiring an adviser for retirement a good idea?

Hiring a financial adviser is a personal decision, so you’ll want to consider your budget and goals.

You might want to consider hiring a financial adviser if:

Your financial situation is complex: You have multiple income streams, several investment portfolios, real estate holdings or own a business.
You have a high net worth: Managing significant wealth requires advanced financial planning, tax optimization and inheritance strategies — all areas where financial advisers specialize.
You received a substantial inheritance: Windfalls require careful planning to maximize benefits and manage taxes. This can be a part of your financial life where emotions run especially high so an objective third-party perspective can be valuable.
You’re going through a major life event: Life changes — such as the death of a spouse, getting divorced or getting married — impact financial priorities. Advisers can help adjust your plan to accommodate new goals and responsibilities.

While working with a financial adviser is valuable, here are a few situations when you might be able to avoid paying for professional help.

Your financial situation is simple: If you don’t own property and have minimal savings, you may be able to manage retirement planning independently without the need for specialized advice.
You’re knowledgeable about financial markets and investing: If you feel confident in your ability to make long-term financial decisions and stay current on market trends, you might opt for a do-it-yourself approach.

How to find a financial adviser

When picking a financial adviser, it’s crucial to look for a fee-only fiduciary. These professionals are ethically bound to work in your best interest — not the interests of insurance companies or financial institutions. They’ll provide unbiased advice you can trust.

You’ll also want to look for advisers with expertise in retirement planning. If your estate is particularly large and complex, you might want to work with a wealth manager, since their services cater to high-net worth clients.

You should also check an adviser’s background and credentials before trusting them with your financial information. A good place to start is BrokerCheck from the Financial Industry Regulatory Authority (FINRA). It offers an overview of an adviser’s work history along with their firm’s history.

Once you’ve narrowed down your search, interview potential advisers to gauge their investment approach and experience. Make sure your communication styles align. Advisers can get compensated in several ways, so get clear understanding about how they’re paid and make sure the price fits your budget.

Bottom line

A financial adviser brings a lot to the table. The benefits of expertise, time savings, emotional support, goal setting and tax optimization can far outweigh the risks associated with attempting to manage retirement planning on your own. An initial investment might be well-worth the cost if it prevents you from running out of money in retirement.

©2024 Bankrate online. Visit Bankrate online at bankrate.com. Distributed by Tribune Content Agency, LLC.

Niels Lesniewski | (TNS) CQ-Roll Call

Vice President Kamala Harris, the Democratic nominee for president, is set to unveil a set of economic policy proposals Friday, highlighted by a new child tax credit.

The proposal, according to Harris-Walz campaign officials, would provide a $6,000 child tax credit within a newborn child’s first year. It also would bring back a child tax credit from the 2021 reconciliation law and expand earned-income tax credits for many taxpayers without children.

“It will provide up to $3,600 per child tax credit for middle-class and the most hard-pressed working families with children,” officials said.

The tax portion of the proposal also includes expended premium assistance tax credits. Harris is expected to detail the economic messaging and policy proposals as part of a campaign speech Friday afternoon in Raleigh, N.C.

She is also expected to announce proposals on housing and lowering costs, which the campaign previewed earlier this week.

The Harris proposal for assistance for first-time homebuyers goes beyond what President Joe Biden has proposed.

“The Biden-Harris administration initially proposed providing $25,000 in down payment assistance only for 400,000 first-generation home buyers — or homebuyers whose parents don’t own a home — and a $10,000 tax credit for first-time home buyers,” a campaign fact sheet said. “Vice President Harris’s plan will simplify and significantly expand that plan by providing on average $25,000 for all eligible first-time home buyers, while ensuring full participation by first-generation home buyers.”

The campaign said Harris also wants to “accelerate” the process under which the Centers for Medicare and Medicaid Services are negotiating the cost of prescription drugs. CMS announced the price list for the first 10 drugs, with the reduced sticker prices due to take effect on Jan. 1, 2026.

Biden and Harris appeared together Thursday in Prince George’s County, Md., to highlight the news.

Friday’s announcement of key Harris agenda items coincides with the second anniversary of the reconciliation law that provided for the Medicare price negotiations. The White House highlighted the vice president’s role in breaking the tie vote in the Senate, which cleared the way for the law’s enactment.

“While Republicans in Congress try to repeal this law — which would increase prescription drug costs and take good-paying jobs away from their constituents, all to give massive tax cuts to big corporations — Vice President Harris and I will keep fighting to move our country forward by investing in America and giving families more breathing room,” Biden said in a statement Friday.

Republicans, too, have highlighted the role of the vice president in breaking ties in support of the Biden administration’s agenda (for which she holds the record). Though GOP lawmakers like Sen. Joni Enst, R-Iowa, have a far different take on the implication of those votes.

“Kamala Harris cast the tie-breaking vote on a pair of trillion-dollar tax and spend bills that created a 20% inflation surge,” Ernst posted on X earlier this week.

The post Harris to propose tax cuts for newborns, funds for first-time homebuyers appeared first on Roll Call.

___

©2024 CQ-Roll Call, Inc., All Rights Reserved. Visit cqrollcall.com. Distributed by Tribune Content Agency, LLC.

By ADRIANA GOMEZ LICON Associated Press

MIAMI (AP) — Five summers ago, Donald Trump’s running mate JD Vance — then a 34-year-old memoirist and father of a 2-year-old boy — took the stage at a conservative conference and tackled an issue that would become a core part of his political brand: the United States’ declining fertility rate.

“Our people aren’t having enough children to replace themselves. That should bother us,” Vance told the gathering in Washington. He outlined the obvious concern that Social Security depends on younger workers’ contributions and then said, “We want babies not just because they are economically useful. We want more babies because children are good. And we believe children are good, because we are not sociopaths.”

Vance repeatedly expressed alarm about declining birth rates as he launched his political career in 2021 with a bid for the U.S. Senate in Ohio. His criticism then of Vice President Kamala Harris, now the Democratic presidential nominee, and other high-profile Democrats as “childless cat ladies” who didn’t have a “direct stake” in the country have drawn particular attention since Trump picked him as his running mate.

The rhetoric could threaten the Republican ticket’s standing with women who could help decide the November election. But it’s delighted those in the pro-natalist movement that has, until now, been limited largely to policy wonks, tech executives and venture capitalists.

“There’s no question the discussion around family life, childbearing and pronatalism has gotten a lot more popular and gotten media attention because of JD Vance,” said Brad Wilcox, the director of the National Marriage Project at the University of Virginia and author of “Get Married.” Vance once referred to Wilcox as “one of my favorite researchers.”

Vance’s spokespeople did not respond to messages seeking comment.

An aspiring politician’s war against ‘anti-child ideology’

Vance, who wrote a bestseller about his working-class upbringing, has been clear about making family formation a policy priority. He has suggested ideas such as allowing parents to vote on behalf of their children or following the example of Hungary’s Viktor Orbán of giving low-interest loans to married couples with children and tax exemptions to women who have four children or more.

In a May 2021 interview with The Federalist’s podcast in which he said he was exploring a Senate run, Vance described a society without babies and kids as “pretty icky and pretty gross.”

“We owe something to our country. We owe something to our future. The best way to invest in it is to ensure the next generation actually exists,” he said. “I think we have to go to war against the anti-child ideology that exists in our country.”

Vance has suggested people without children should pay higher taxes than people who have children. That’s the spirit of the existing child tax credit at $2,000 per qualifying child, which Vance has said he’d love to see raised to $5,000. He has also mentioned in interviews he wants to ban pornography for minors, citing it as one of the causes for why people are marrying less and having fewer children.

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His anti-abortion views, he has said, are separate from his concerns on birth rates, arguing the procedure is not really driving the decline in fertility.

In several interviews, he’s argued policymakers should make it easier for two-parent households to be able to live on a single wage so that one of the parents can stay home with their children.

“The ruling class is obsessed with their jobs. Even though they hate a lot of their jobs, they are obsessed with their credentials and they want strangers to raise their kids,” he told then-Fox News host Tucker Carlson in 2021. “But middle-class Americans, whatever their station in life, they want more time with their children.”

Vance had a chaotic childhood raised mainly by his grandparents in southwestern Ohio and a mother who battled substance abuse, and her “revolving door of father figures” as he described in his book. He is now married to a trial lawyer he met at Yale Law School. The couple has three young children, who he has said attend preschool. Usha Vance left the law firm where she worked shortly after her husband was chosen as Trump’s running mate.

Declining births in an aging America

The U.S. was one of only a few developed countries with a fertility rate that ensured each generation had enough children to replace itself — about 2.1 kids per woman. But the number has been sliding since 2008 and in 2023 dropped to about 1.6, the lowest rate on record.

Earlier this year, Vance cited fertility rates in arguing against American support for Ukraine.

“Not a single country — even the U.S. — within the NATO alliance has birth rates at replacement level. We don’t have enough families and children to continue as a nation, and yet we’re talking about problems 6,000 miles away,” he said.

Vance as well as researchers and experts on the pro-natalist movement also argue that immigrants can’t provide a long-term fix to the decline in birth rates. He has separately blamed immigrants for crime and creating “inter-ethnic conflict.”

Demographers and other experts for years had predicted declining fertility rates would pose challenges for the Social Security system as fewer workers are supporting a growing aging population.

Tech executives such as Tesla CEO Elon Musk and venture capitalist Peter Thiel, who donated millions for Vance’s primary race, have also been vocal about the decline in birth rates.

“We as a nation, as a society, policymakers can’t be neutral on the question of family,” said Oren Cass, who founded a conservative think tank, American Compass, that is closely aligned with the senator.

Cass, a former policy adviser for U.S. Sen. Mitt Romney, said he has known Vance for a decade and partnered on several events but said he was not speaking on behalf of the vice presidential nominee. He criticized how progressives have celebrated what he described as a culture of “you do you” and “all choices are equally valid,” when he considered the work of forming a family and raising children an “indispensable foundation” for the country.

“That’s not to say, obviously, that you mandate or criminalize the alternative, but it is to say that we shouldn’t be neutral about it,” he said.

Vance on the defense

Vance’s views on birth rates have contributed to his rocky rollout as Trump’s running mate. Democrats went from labeling Trump and his Republican allies as a collective “threat to democracy” to calling both men “weird,” a strategy that coincided with Vance’s comments coming to light.

Other unlikely critics have also piled on. Trump-backing influencer Dave Portnoy said Vance “sounds like a moron.” Former Republican congressman Trey Gowdy tried unsuccessfully to force an apology out of Vance for his denigrating of childless women on his Fox News show, introducing him with a story about a pair of Catholic nuns he met at an airport.

Actress Jennifer Aniston, who has been open about her fertility issues, weighed in by saying she hopes Vance’s daughter does not face the same problems and she “truly can’t believe that this is coming from a potential VP of the United States.” Vance responded by calling her Instagram reaction “disgusting.”

Trump has come to his defense, accusing Democrats of spinning things and expressing empathy for people who don’t get married or have children and are “every bit as good.”

“He likes family. I think a lot of people like family. And sometimes it doesn’t work out,” Trump said in one interview. “But you’re just as good, in many cases a lot better than a person that’s in a family situation.”

Vance’s wife has also tried to do some damage control, saying Vance was not referring to those who struggle with fertility or can’t get pregnant for medical reasons, though the ideas he proposes don’t make that distinction.

“The reality is he made a quip in service of making a point he wanted to make that was substantive,” Usha Vance told an interviewer on “Fox and Friends.”

Can Vance advance this?

Wilcox, the author of “Get Married,” said JD Vance now needs to focus on convincing a broader audience that his ideas are worth pursuing.

“The challenge for JD Vance is taking that attention and translating it into more of a concrete policy agenda that would be compelling to ordinary Americans and articulating a clear and positive agenda around making family formation both more affordable and more appealing,” Wilcox said.

Supporters at a recent Trump rally in Harrisburg, Pennsylvania, shrugged off Vance’s assertion that parents should have more of a vote than childless adults and expressed complicated feelings about his views.

Kenneth “Nemo” Niemann, 70, said Vance might be speaking figuratively about giving parents more votes. His wife, Carol, 65, disagreed, saying Vance has been crystal clear that that is exactly what he means.

The Niemanns had children later in life — their twins are 16 — and they spent far more of their adult lives as childless adults. And while they talked about how adults with children can have more to say when it comes to policies affecting children or they can have a different worldview about the future than childless adults, they still disagreed with Vance.

“My sister never had children, but I can’t imagine my vote means more than hers,” Carol Niemann said.

Associated Press writers Michelle R. Smith in Providence, Rhode Island, Mike Schneider in Orlando and Marc Levy in Harrisburg, Pennsylvania, as well as Associated Press researcher Jennifer Farrar in New York, contributed to this report.