3 Phases of Life
There are really many different phases of life. From our formative childhood years to adulthood and into retirement we all grow through different transitional points as we move from stage to stage. But, financially speaking, there really are 3 main phases of life for which most of us need to focus on and plan for well before these major transitions occur.
3 PHASES OF LIFE
Accumulation - Ages 20- 55
During this phase of Accumulation you are working everyday and right or wrong, you may feel that you could afford a little more financial risk. If things go terribly wrong as they do often for many of us and you lose money in the market you may feel you still have many more working years (sadly enough) to try and replace what you may have lost. Financial planning, protection planning, savings and investing, asset allocation and diversification strategies should be developed with the help of a professional to make sure you are on target for your future goals, such as, weddings, home purchases and college funding as you move towards your next major phase of life.
Preservation - Ages 55-70
We call this time the
Preservation period of your life and the word "risk" should be carefully defined, measured, analyzed and in many cases maybe even removed from your financial vocabulary. With most of your income earnings years behind you it is critical that you protect and preserve everything that you invested your entire life to earn and accumulate. You need to protect what you can't afford to lose and develop predictable and tax efficient income strategies that will continue on long after you are no longer able to work. While Income Planning should begin from day 1 of your journey, (after all, future income is ultimately what most of us saving for), it is most critical to secure it's source before and upon entering into this
Preservation Phase.
Distribution - Ages 70+
You have hopefully done a wonderful job during the Accumulation Phase, but it is clear today that as good a job as you, with the help of your advisor, may have done in growing your estate up to this point in your life, you need the services of someone who specializes in asset Preservation and Distribution strategies.