Written by: George Shirley - Any opinions are those of George Shirley and not necessarily those of RJFS or Raymond James.
Traditional financial planning often uses age as a key metric. At this age you need this much saved; if you want to retire at this age you need to do this; financial goals to obtain in your 30s, 40s, 50s 60s; if you are this age, here is the amount of risk you should have in your portfolio. Ever read an article like this?
In my opinion however, more important than age is life stage. Where you are in your career, your family situation, age difference of spouses, ages of your children, ages and health of your parents etc. I know 45 years-olds with 2 year-old children, and other 45 years-olds who are grandparents. To say that their outlook on life and their financial priorities should be the same seems a bit ridiculous. I find that the one-size fits-all approach in a lot of financial literature can do a significant disservice to someone whose life situation might not fit neatly into what is considered a traditional path.
So using your age as a key metric to assessing your financial situation only tells a portion of the story. Taking the time to understand all the external things that can impact the priorities and financial objectives is one of the main ways that we seek to deliver the personalized guidance that our clients deserve…certainly more than placing someone conveniently into an age based investment strategy.
Listen to our podcast:
2018-006349