Part of the Cambridge System of financial planning, the financial life cycle is divided into a series of stages based on your financial situation and progress in saving for retirement. These life stages usually correspond to certain age ranges, but don’t worry if your financial stage is out of sync with out your age. There is always time to save for retirement. Read on for information on determining your place in the financial life cycle.
During childhood, most people develop their fundamental beliefs about money. When your parents took you shopping, you learned that money can buy things like food and toys. Your parents may also have helped you save money. As a teenager, your first job taught you the importance of budgeting money you earn. These lessons become vital to later stages of financial life.
As a young adult, you are in the beginning of the accumulation stages. At first, despite any debt you may have, earning money makes you feel rich. Instead of spending the money, motivate yourself to start saving for retirement. During the accumulation stage, which lasts until about age 55, you should save as much as possible.
When the income generated by your portfolio exceeds half your annual income, you have achieved financial independence. This is the time to make your portfolio more conservative to give yourself peace of mind. Your portfolio continues to generate income for you to live on in your retirement.
In this final period of life, you have the opportunity to pass your wealth on to others, whether it be family, charities, or friends. As you reach your final years of life, you can direct how the money you have earned and invested will be distributed after your death.
No matter where you are in life, it is never too late to save for retirement. Financial planners are essential to this process. Plan and Act is a fee-only financial advising firm that earns money only through stewardship of your investments. To get started with your financial plan, call us at (720) 897-7966 or Like Us on Facebook for a FREE FINANCIAL ASSESMENT.
* Plan & Act is a registered Fiduciary Financial Advisor. This ensures the financial advice you receive from us is objective, unbiased, and protects your financial interests.
Financial planners are excellent resources for managing your money and preparing for the future, but their services may be more costly than the benefits you receive. This is in part due to the fact that many brokers and financial advisors are paid a commission for selling certain financial products. The fiduciary services of an independent Internet-based organization are a suitable alternative to traditional financial advisors because they can offer objective input on your current financial situation and suggest the best options for your individual needs. Here are some of the advantages to using an Internet financial service:
- Convenience: Viewing your portfolio and managing your investments online allows you to access you financial information no matter where you are. There is no need to schedule an appointment to speak with your advisor, as all the planning services take place over the web. Instead of feeling pressured into high-stakes decisions on the spot, you will be provided your options based on the your specific financial needs.
- Affordability: Online financial planning comes at a much lower cost than the fees of a personal advisor. Traditionally, advisors and brokers come at a price much higher than middle class Americans can afford, but the need for sound financial advice in a period of economic uncertainty has changed that and paved the way for alternative solutions.
- Safety and Privacy: Strict federal and state regulations apply to online financial planning in the same way they do to face-to-face planners. This means that all of your information is transferred securely and kept confidential throughout the entire process.
If you would like to see how easy it is to manage your money over the Internet, visit PlanAndAct.com and get started today. Our unique approach to financial advice can help you plan quickly and easily.
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