Your Financial Life Stages

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Investors have many difficult decisions to make, in each stage of their lives, and every financial decision is based on your virtues. You must do what is best for your family throughout all of your and their financial life’s stages.

The first financial life stage is the Learning Stage. Before graduation from school, children typically go to their parents to seek financial advice on topics such as how much to save and spend their first paychecks, where to invest, what credit card to get, what life insurance or disability to purchase, how to invest their employer’s retirement plan, how to buy a car, or how to rent an apartment. Parents are a wonderful resource, as long as they have appropriate knowledge. 

The second stage of life is the Working Stage. This is the stage in which people are aware they might like to eventually retire. They could experience many types of financial concerns: life insurance to protect their family’s income stream; non-retirement planning priorities; how much to invest for retirement; invest appropriately, so their investments are getting market returns no matter what the economy does; how to avoid losing purchasing power; where to invest their "emergency money"; how much they can afford to withdraw from their savings; and making loans to family and friends from their own retirement nest egg. This is the accumulation stage, when you need to work for your money and have your money work hard for you. This is the most important financial stage of your life, as the decisions you make during the working years will determine your retirement lifestyle.

The third stage of your life is the Retirement Stage. Work has ceased. Retirees have some of the previous concerns, plus additional ones: running out of money, keeping healthy, long-term care, caring for older parents, avoiding taxes, no growth to stay up with inflation, paying income taxes on dividends they do not need, and taxes. This stage is when your money needs to continue working for you, keep ahead of inflation, and be protected.

Consider the implications if you ignore or don’t consider just one of these financial concerns in each of these stages. All three stages have their difficulties and expert guidance is necessary, as making just one poor decision can affect the success of your long-range goals, contentment, and ultimate happiness!  

Written by: Maria J. Wordhouse Kuitula and Phyllis J. Veltman Wordhouse, free market wealth and stewardship coaches, co-authored the book Stress-Free Investing, available at Amazon.com. Maria is the president of Wordhouse Wealth Coaching and may be reached at 616-460-6518 or [email protected]. For QUESTION LISTS and INVESTOR EDUCATION VIDEOS, go to www.WordhouseWealthCoaching.com. © Wordhouse Kuitula 2013.

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