Kayla Tausche CNBC

y andrea lehner
AN ENDGAME FIRST PERSPECTIVE
FRESH APPROACH TO RETIREMENT PLANNING
Retirement planning includes added risk factors and considerably less room for
error. If early decisions lead to a faltering cash flow during retirement, there is no
room for recovery, and the results could be disastrous. That’s why it’s important to
approach retirement planning with an endgame-first perspective.
And, according to Theresa Yarosh,
founder and president of
Macro Wealth Management,
LLC, understanding the truth of how
money works is critical to successful
retirement planning.
“The traditional model,” Yarosh
said, “lacks a level of sophistication
that would facilitate a client’s ability
to create an income stream.” Her
solution draws from 25 years of economic
education and expertise to
teach clients why and how to develop
multiple sustainable income streams
that will last throughout retirement.
“The key,” Yarosh explained, “is
using an economic model grounded
in the utilization theory of finance,
rather than in the more commonly
used accumulation theory. In this
manner, planning works backwards
from the endgame – retirement – to
ensure the right income streams are
being established to mitigate common
wealth-eroding factors such as inflation,
taxation, technological changes,
planned obsolescence, market volatility,
long term care and the anticipated
consumption of resources.”
She likens this approach to that
of mountain climbing. Most people
know they need a guide going up the
mountain, but they forget they still
need a guide for the most dangerous
part of the trek – going down. Macro
Wealth Management’s mission is to
guide their client not only to, but also
through retirement safely.
Yarosh does this by first helping
her clients achieve a savings rate of 15
percent per year, which she says is the
ideal goal. “It is important to remember
that savings is essentially delayed
expenditures,” she said. “Therefore,
this savings rate must be rules-based
in order to take into consideration all
of the eroding factors in the plan.”
Stressing the importance of understanding
the difference between
money and math, Yarosh explains
that money, like fruit, is a commodity
which erodes over time. Using
straight mathematical equations of
savings found in traditional accumulation
plans creates a false projection
of usable wealth.
In reality, the focus needs to be centered
on understanding the efficiency
of money, so that wealth created over
a period of time can be used when
needed without depleting capital resources.
“Because we are working
from the framework of utilizing the
efficiency of how money works, our
clients are better positioned in terms
of longevity,” Yarosh added.
In today’s social environment of
better healthcare and increased life
spans, longevity is an economic risk
multiplier. “The longer you live,” she
explained, “the more you are going to
confront market volatility, sequence
of return risk and healthcare expense
risk.”
Macro Wealth Management employs
several strategies to ensure
clients have the funds necessary to
maintain a standard of living with
provisions for long-term care expenses
for the duration of their golden
years, including annuities, long-term
care insurance, hybrid policies that
earmark a portion of the benefits for
long-term care and life insurance pol
THE SUIT MAGAZINE - JAN 2015