Financial Advisor / Co-Founder Thin Line Financial
Gary D’Alessio has been a police officer for quite some time. He has worked alongside some great officers and has held a variety of assignments. A couple of years ago, as D’Alessio approached the halfway point of his career, he began to contemplate several things, including his future retirement. He realized that…
There was one major problem: When it came to financial planning, investing, and the intricate rules of the New Jersey public pension systems, his co-workers were typically uneducated on these topics and unaware of the pitfalls. This made D’Alessio realize that something had to be done to fix this broken system. “People had no idea what they were doing with their pensions or 457b plans,” D’Alessio says. “No idea at all where their money was going or how it was being invested; and this is dangerous.”
This bothered D’Alessio. So, he decided to do something about it since no one was adequately advising these men and women in blue on one particularly important aspect of their careers – their retirement. “During the academy, we were trained on a host of topics, but no one is giving the law enforcement community any financial or retirement planning training,” D’Alessio said. He went on to note, “in a career that relies so heavily on teamwork and camaraderie, we are kind of left to our own devices when it comes to retirement planning; and typically, with no training. It just doesn’t make any sense to me.”
D’Alessio’s entire background is in law enforcement. He has been working in law enforcement his entire adult life. Born in New Jersey in 1989, he began his career as a seasonal law enforcement officer at the Jersey Shore at the age of 18. D’Alessio eventually found his way to become a patrol & narcotics detection K9 handler. D’Alessio has worked in various law enforcement roles for the past 12 years to include: patrol, traffic, K9, and community relations.
He also attended Rutgers University (NJ) and Wilmington University (DE), earning a master’s degree in criminal justice administration and homeland security. He also attended dozens of other law enforcement training classes. In 2018, he began to pursue financial certifications and designations, noticing that there was a serious lack of financial education for police officers and other first responders. D’Alessio realized that fellow officers were struggling financially after retirement, and he wanted to do something to help.
“Being a financial advisor looked interesting, and I realized I could help people in my profession,” D’Alessio recalls. “I began studying various retirement systems and deferred compensation plans. I educated myself.” This was the birth of Thin Line Financial Group.
THE “SYSTEM” ISN’T USER FRIENDLY
Upon investigating his own department’s benefits, what he found was a complicated and limited 457b plan. The state pension benefits operated under a “tier system,” which no one seemed to have a clear understanding. Therefore, the extent of an officer’s retirement benefits were limited to a defined benefit plan offered through the state and a defined contribution deferred retirement compensation account sponsored by the township, which included various investment options in mutual funds and other market-based investments. The majority of officers did not seem to have any other retirement accounts or assets outside of the job.
D’Alessio began to realize that many of the officers that he knew were unsure of what their pension benefit would be and what their supplemental retirement investments were. The majority were blindly making monthly contributions to a 457b retirement account into mutual funds, and they weren’t aware of the relatively high costs of the plan, what the returns of their investments were or what the tax implications of the account were. D’Alessio recalled his experience years earlier when the township’s 457b plan representative came to his new employee orientation. He recalled being handed an enrollment form to fill out to authorize a payroll deduction into his new “deferred comp” plan. There was no mention of how the program worked, what the fees were, what the underlying investments were, how the money would be taxed, or how this plan could benefit him during retirement. Looking back and knowing what he knows now, D’Alessio realized he and his fellow officers were done a great disservice by not receiving any education along with those enrollment forms. The only advice that was given was that when an officer received a pay raise that they should increase their 457b contributions. But was that the best investment strategy?
Wanting to be able to act as a true fiduciary, D’Alessio redoubled his efforts to get his arms around the retirement plan and various investment options, as well as personal finance and investing. He earned several financial designations, including the Series 65 (Investment Advisor Representative) as well as state life & health insurance licenses to better understand other employee benefits such as life, health, and disability insurance. As word got around, police officers and other first responders came to him for financial and investment advice. D’Alessio even began managing retirement investments and putting on retirement workshops for various police departments and school districts. Some local departments even asked him to present financial education classes at their annual in-service training.
D’Alessio is still an active police officer but also founded Thin Line Financial Group, helping police officers, firefighters, and teachers as his primary clientele. “I know that world, I like the people and they’re comfortable with me — cops and firefighters usually don’t trust anyone but cops and firefighters. I wanted to be an advisor that they could trust and who would help them achieve their financial goals. I wanted to be the person in their corner”
Like any group, law enforcement officers and other first responders have their own set of issues, including a high divorce rate, younger-than-average retirement age, a higher-than-average chance of becoming incapacitated while on the job and a predisposition to certain health issues. These things present additional concerns, and they must be accounted for in a proper financial plan.
“The rate of divorce among law enforcement officers is close to 60%,” D’Alessio says. “That affects financial planning because if part of a client’s pension is going to go to an ex-spouse, that will mean the amount they receive in retirement will be different from what they were expecting.” There are also their other retirement assets we must take into account and plan for. Taxes are another significant planning point.
Serious injury on the job is “always a concern” for first responders, D’Alessio noted. “In addition to health concerns, it can also affect your pension, especially if you are injured or fall ill off of the job,” he explains. “It may impact the amount of money you are eligible to receive in the form of a pension. This is why we need to plan for these things as well as other unexpected events, like what if I get sick? What if I need long-term care? What if, what if, what? We need to have all of the what if’s accounted for.”
Clients who can retire in their 40s and 50s with a comfortable pension are also clients who require more-complex financial planning. D’Alessio points out this pension payment often becomes a “false crutch” leading pension recipients down the dangerous path of thinking they do not have to do any personal retirement saving or planning. Nothing could be further from the truth, D’Alessio said. “The pension is the foundation of retirement, but we still need to build the rest of the house.”
“First responders who are highly skilled have a lot of options for highly paid employment,” he says. “They can work for hospitals, consulting groups, insurance companies, casinos or security firms, for example, full-time or part-time. They have many years of work ahead of them in some cases and need to understand their new benefits and rules like IRS rollovers, and also how their new retirement benefits work in conjunction with their old plans.”
D’Alessio was able to simply and clearly explain the options in the New Jersey public retirement systems that persuaded several municipalities and school districts to become clients. Now they regularly bring D’Alessio in to conduct retirement seminars and consult with employees on a one-on-one basis. D’Alessio now works with public employees all over the country with clients from New Jersey to Idaho and several places in between.
“I worked with Gary and know the man and his character,” a client says. “He knows us and not only talks our talk, but he still walks the walk as a police officer as well. But, it was Gary’s knowledge of the retirement system, our benefits, and our 457 plan that made me comfortable. I’m not a financial guy, and he answered any questions I had. The way he explained things was on my level, and he didn’t use confusing financial lingo. That was the deciding factor for me. He knew how the system worked and where people tend to go wrong. I now feel confident that I will be prepared for retirement.”
A RECENT RETIREMENT CRISIS
A turning point came recently when several members from D’Alessio’s agency lost tens of thousands of dollars in their 457b accounts, just months before their retirements. D’Alessio did not manage these plans. Like many other agencies, there was only one investment provider in that particular municipality, and the representative that enrolls employees into the program had a non-existent presence.
“I realized that, when it came to the 457b investment options, people needed help and advice. You only get one shot at getting your retirement finances right, and the plan they had was severely failing them.”
That is why D’Alessio works as an independent financial advisor. “I did not want to simply sell financial products to other cops,” D’Alessio noted. “We already have that in our agency, and it a disaster – a true disservice to the officers.” Instead, D’Alessio wanted to act as a fiduciary and help other first responders do holistic financial planning, and to do what was best for them, not some investment or insurance company. Working as a fiduciary means the client’s best interests are put first and foremost.
“There is no pressure to sell anything; it is about the clients’ needs,
explains D’Alessio. This enables him to spend more time with clients, and he hopes “to bring on more advisors with law enforcement or similar background to help more first responders and help to make retirement an exciting time, not a time of financial worry and stress.” So far, D’Alessio had added two more to the Thin Line Financial Group team, one former and one current police officer. D’Alessio noted that it is essential that his entire team maintains his mission and vision.
We saw that Gary has an unparalleled passion for his clients and is genuinely devoted to first responders, which is why we have decided to have him author the “Retirement” section of arrestyourdebt.com. He will offer insight and information on many retirement topics and make himself available to discuss any concerns, issues, or questions you may have about your retirement or financial planning.
To Your Retirement!