Life Stages & Wealth Building

Learn why it is important to invest in your future early in your life stage so that you can build wealth more efficiently…

 

Investing for your future can be a way to reach many of your goals.

 

However, it is important that you know your money management personality and what stage you are now at in your life so that you can choose the type of portfolio that allows you the opportunity to reach your intended wealth building goals.

 

In this discussion TheWealthIncreaser.com will (hopefully) help you come to a clearer decision on your investment portfolio selection based on where you now are in your life stage and your intended goal(s).

 

Regardless of your life stage you must begin your wealth building journey by knowing what you are building wealth for.  Or another way of looking at it is what are your goal(s) for utilizing the funds that you plan on investing and what is the timeline when you will need those funds?

 

If you are saving for your retirement and you are age 30 you can use a more aggressive portfolio than if you were saving for college for your 9 year old son.  If you were age 70 and was seeking steady income during your retirement years you would want to take a more conservative approach with your portfolio selection.

 

If you are uncomfortable in the selection of portfolios you can use financial advisors, however it is important that you choose your financial professional(s) wisely.

 

Below we will analyze three savings scenarios to help give you an overview of how you can put together an investment portfolio that could possibly help you build wealth more effectively and more efficiently depending on your life stage.

 

Saving for Retirement

If you are age 30 and you plan on retiring at age 62 you want to “save aggressively” due to the long time horizon as it gives you time to absorb the ups and downs of the market.  If you wanted to achieve financial independence and retire early you would be at a point in your life stage where you would have a need to invest even more aggressively.  Under either scenario you would want to put up to 85 percent of your portfolio in stocks and 15 percent in bonds.

 

Saving for College for your Children

If you are age 30 and you plan on saving for your 9 year old sons college tuition you want to save less aggressively or at a “moderate” level, therefore your investment portfolio might consist of 60 percent in stocks and 40 percent in bonds based on your time horizon of 9 years.

 

Saving for Income During Your Retirement Years

If you are age 70 and you are retired you would be at a point in your life stage where you invest more conservatively.  You would take a “conservative” approach because you are at a point in your life where you can’t afford to take losses–therefore a consistent blend of 65 percent bonds and 35 percent stocks might be appropriate for your situation.

 

Conclusion

 

It is important that you have a conceptual overview of where you are now at in your life stage as that knowledge has the potential to provide you more clarity about where you are now at and where you can possibly go.

 

The above scenarios are to be used as a guide only and you may have to tweak the investment percentages to meet your intended goals based on your particular age and time span for use of the funds.  However, it can be used as a starting point to get you in the frame of mind to invest in a way that will help you build wealth.

 

By determining at the earliest time possible the goals that you want to pursue and determining the type of portfolio that is needed you can move about your life in a manner that reduces anxiety and provide a road map that is realistic and achieve goals that are more likely to occur.

 

Keep in mind that market downturns can occur and on occasion at the time that you want to utilize (cash in) the funds for your intended goals.

 

By getting a real jump on your investments by knowing where you now are and where you want to goyou are showing great faith and belief in yourself and there is great favor–in your horizon by doing so!

 

All the best to your life stage and wealth building success–regardless of your age or life stage…

 

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