As you age, the time span from making money on your investments decreases and also your ability to recover from losses is reduced. It is for this reason that most people follow the pattern of riskier investments while they are young and then move toward more conservative investments as they age. Of course, in your 20s, it is rare that you have a general awareness of investments that are available, not to mention the desire to ‘plan for the future’.
In fact, it is not uncommon to simply push financial planning and investment off until near retirement age. Whether it is lack of time, lack of knowledge or lack of interest – most people under the age of 50 do not plan for their financial future. It often takes tragedy or fear to motivate many individuals to consider saving for a “rainy day.”
Asset protection is an important part of life. A greater emphasis should be placed on how to protect your assets – because you never know where life will take you or what could happen – at any age.
Protecting your Assets
The primary focus of your plan should include financial growth and protection of your money. You might choose to develop a savings plan that will give you a nest egg to live off of when you retire or you may prefer to create a plan that will leave your assets to your family while allowing you to live off interest and dividends upon retiring.
An experienced financial planner can be crucial to helping you put together an effective plan that will suit your needs and the needs of your family. A healthy financial plan will build wealth with minimal risk in a reasonable amount of time and factor in unforeseen circumstances that may be tough to consider, such as premature death.
Well-made financial plans also need frequent review to make adjustments for what happens in your life – getting married, having children, changing jobs, and even the economy. Making a plan and then forgetting about it until you are near retirement could leave you unprepared.
Consider the recession that has hit the world over the last few years – no one expected companies that have been cornerstones for a hundred years or more to disintegrate and those corporate bonds to lose their value. As recently as last week, there are American cities that cannot pay their debts and have declared bankruptcy – anything is possible, which makes a solid plan to protect your money all the more essential.
Seek the advice of a professional to develop a savvy financial plan and then mark your calendar to revisit and rework the plan on a consistent basis. Don’t attempt to plan for your financial future on your own – it can leave your money, assets and well-being unprotected.