Fund Mojo Newsletter

Fund Mojo on Facebook Follow FundMojo on Twitter Fund Update
Fund Mojo provides investors and financial advisors with in-depth mutual fund research and analysis, and a community and gateway to connect investors with peers and financial experts to help each other with investments and financial planning needs.

How To Set Your Financial Priorities


During our lives, we move through the financial lifecycle. We begin by saving for a house, then focusing on our children's college education, and later, we're looking toward retirement. To help set your financial priorities, consider the following life stages.

 

Early years (25-40)

At this stage, it's best to focus on growth-oriented products since many of your goals are several years away. To create a balance, life insurance can offer safety and stability in addition to death protection.
  • Work on your savings through good financial habits.
  • Consider taking risks with your investments for the chance to outpace inflation.
  • Have adequate life and long-term disability income insurance, and be sure your policies cover your needs.
  • Beware of credit card debt, car loans, lease payments, and mortgage debt.
  • Set up an estate plan shortly after marriage and update it when you have children. It's important to have a will, a living will and a durable power of attorney.

 

Building years (40-50)

A rising income is helping you achieve your goals during this stage in your life. However, expenses such as your children's college education may reduce your current spendable income. The need for growth is still essential since retirement is nearing, yet impending goals may warrant a shift toward more conservative products.
  • Size up your retirement needs to project your annual retirement income and expenses.
  • Be more conservative and avoid making high-risk investments.
  • Weigh your financial needs against those of your children. Don't let your children's college costs interrupt your retirement savings plan.

 

Refining years (50-60)

Your peak earnings combined with reduced financial responsibility for your children can make this stage financially rewarding. Accumulating assets for retirement is more important than ever.
  • Consider a shift toward more conservative growth opportunities including inflation protection.
  • Take a look at your estate plan. Your estate may have grown to the point that you can benefit from advanced estate planning techniques, such as marital status and life insurance trusts.
  • Determine your desired retirement lifestyle and plan accordingly.

 

Rewarding years (60 and over)

To maintain your lifestyle during retirement, you'll likely need extra income to supplement Social Security benefits and pension payments. The majority of your savings and investment program should focus on producing income and protecting your investments against inflation.

 

It's never too late to begin prioritizing. The first step to help determine your future financial needs is to participate in a needs analysis session.

 

Free review

Call Helen Hou from the Principal Financial Group for a no-cost, no-obligation review of your retirement plan investments.