In her May 4 Think Advisor article, “Moshe Milesky: Advisors Should Charge More for Retirement Spending Advice,” Ginger Szala interviews Moshe Milesky about his new book, “Retirement Income Recipes in R” and why current and future financial advisors (and others interested in asset decumulation in retirement) should read it.
Dr. Milesky is a revered professor of Finance at the Schulich School of Business, and we have periodically included references to his articles and ideas in our prior posts. We haven’t yet read his new book, but we can only assume (like actuaries do) that it is worth reading, especially by those with relatively advanced financial economics and math skills.
As an inducement to encourage current and future financial advisors to read his book, the ThinkAdvisor article notes:
“[Decumulation is] an expensive and elaborate process,” he explains. “It takes time. It’s more complex, time consuming, and who is going to compensate the financial advisor for this time-consuming process?” and
“After all, “people want to get paid for their time. You have to pay more for decumulation advice than accumulation advice. So prepare clients who have become accustomed to paying very little for accumulation advice, that decumulation advice is a lot more expensive.”
According to the book’s promotional blurb in Amazon:
“This book provides computational tools that readers can use to flourish in the retirement income industry. Each chapter describes recipe-like algorithms and explains how to implement them via simple scripts in the freely available R coding language. Students can use those skills to generate quantitative answers to the most common questions in retirement income planning, as well as to develop a deeper understanding of the finance and economics underlying the field itself. The book will be an excellent asset for experienced students who are interested in advanced wealth management, and specifically within courses that focus on holistic modeling of the retirement income process. The material will also be useful to current and future wealth management professionals within the financial services industry. Readers should have a solid understanding of financial principles, as well as a rudimentary background in economics and accounting.”
For those financial advisors and DiYers who are looking for solutions to real world retirement problems but are not necessarily interested in how to code them in R, we suggest that you try our much simpler actuarial budget calculators. If you are an advisor who doesn’t separate recurring and non-recurring spending for purposes of developing a client’s spending strategy or who doesn’t separate expenses into Essential vs. Discretionary for purposes of developing a client’s investment strategy, you may wish to check out our actuarial workbooks as a means of strengthening your financial advisor skills.
