New Client Onboarding Center
Welcome to Harmon Street Advisors! We appreciate your business and trust. We’re looking forward to helping you achieve financial success.
This New Client Onboarding Center provides tips and resources to assist with completing the CLIC Client Onboarding process. The Onboarding process will help us get to know you a little better prior to our 2nd Meeting. It will also make for a more productive discussion in our next meeting.
A few ground rules to keep in mind:
- A rough idea of your major financial goals is perfectly acceptable at this point. We will further define your goals and resources during our second meeting. And don’t worry, you will have plenty of opportunities to make changes during the process.
- Don’t worry about health care in retirement. We will define your health care needs in retirement further into the planning process.
- When thinking about your goals, please think in terms of today’s dollars and after taxes. We will account for taxes and inflation during the planning process.
- This process is about making all the stuff you are working so hard for a reality.
TIPS & RESOURCES
2 ways you can begin to define how much you’ll after-tax income you’ll need to live on in retirement.
- Rule of Thumb (a.k.a. “Back of the Envelope”) Approach: 60%-80% of your current pretax income. In retirement you won’t have many of the same expenses you may have now such as 401(k) savings, commuting to work, and the expenses associated with raising children. Depending upon your lifestyle in retirement, these may be replaced with more spending on meals and entertainment.Tip: if you’re more than 15 years from retirement, consider inflating your current income over the number of years until your retirement. Then use 60%-80% of that value. Use our Future Value calculator assuming an annual inflation rate of 2.5%-3%
- Expense Estimate Approach: Add up your monthly estimated expenses across various categories. Expenses may include bills & utilities, groceries, meals & entertainment, memberships & subscriptions, anticipated debt service, etc.). Don’t include medical costs at this point.
CLIC Client has a feature that will allow you to enter itemized expenses. See the CLIC Client Organizer Overview Guide for instructions on entering expenses individually via CLIC Client.(see Additional Resources for Navigating CLIC Client)
You may also use the following sample budget tools to do a rough estimate of various expenses:
To help you estimate an education goal, we compiled a list of different colleges and universities and their respective costs (2020-2021 school year). You’ll want to enter the amount that you would expect to cover from savings/investments: Examples:
- Parents plan to cover 50% of the cost with the remaining 50% covered by through earnings from employment, student loans, scholarships, etc. Enter ½ of the annual total expenses for 4 years as your education goal.
- 2 years at a community college then 2 years at a college or university. Enter the full cost of a college or university for 2 years.
If you see yourself travelling in retirement, setting a separate Travel goal will help you stay on plan in retirement. It will also make estimating your retirement living expenses a little more straightforward. A Travel goal may mean several big trips per year or a combination of 1-2 big trips along with several smaller weekend trips throughout the year.
We’ve provided a few sample itineraries and associated costs.
Elder Care/Nursing Home:
Enter an “Elder Care” goal if you anticipate needing to cover another family member’s care (sibling, parent etc.) Do not enter expenses for a nursing home for yourself. We will conduct a long-term care analysis in the planning process. To determine your cost of an Elder Care goal, use the table below and subtract any income the family member receives or will receive (e.g. social security benefits, pension, etc.)
Tip: Elder care services are used for an average of 3 years.
US Department of Health & Human Services
New Home or Vacation Home:
For a new home or vacation home, enter the amount of the expected down payment.