Can you, in a few bullets, offer your opinions on the benefits of using a CFP? Never done it before, not sure where their advice would fit in with my general investment advice from my investment firm or where the two overlap, etc.
So it's way more in depth than I previously imagined. It starts around goals. I have two young elementary aged kids and we want to be able to retire when the youngest is off to college and we hit our mid-late 50's. We want a decent travel budget at that point and maintain our current standard of living, minus the expenses of having kids in the house. Between now and then we will stay on our current trajectory. New cars every 5 years or so, keep socking away for savings and retirement, etc.
All of that information was plugged in along with our current investments, income, expenses, assets, liabilities, insurance, healthcare coverage, and our monthly discretionary spending. Our family medical history and life expectancies were calculated into the model to know how long our money needs to last. It was all run through a Monte Carlo simulation that tested the inputs against 1000 possible scenarios of future market returns. The goal was to be between 70-90% success rate. (Over 90% means you're probably being too conservative.) Our's spit out an 82% probability of success.
The action items for us were to get an umbrella insurance policy above home and auto to protect our assets for a few hundred dollars a year and update our estate planning since we have moved to another state. Both are items I have not really considered.
The CFP just accounted for everything. Things I would not have and I like to consider myself fairly savvy on things like this. Stuff like bridging healthcare from early retirement until medicare. Factoring in 401k/IRA required minimum distributions down the road. Not messing with ROTH while we are in a higher tax bracket and instead converting a traditional IRA that 1st year after retirement when our income is much lower.
These were just our little nuggets, I am sure everyone will find some. The end result was a 52 page report that gives us a real good baseline for our financial future. As things change along the way, we can make updates to the plan. Here is a screenshot of the table of contents.
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If you have access to a free one. Do it. We probably put about 3-4 hours into it on our end and the CFP did everything else. I would liken it to getting a physical or hiring a home inspection. Even if you think everything is good to go, its comforting to have an expert double check everything for you.
