Has a financial professional ever asked you what the color of your money is?
Many investors are unfamiliar with this terminology. Most individuals have not heard of this because their financial advisers are more interested in discussing the specifics of a certain product rather than how you will benefit from that product. What I see is that focusing on product versus color can have a negative impact on your retirement.
Let’s talk about the financial phases you’re going to go through, including the accumulation phase, the preservation phase, and the distribution phase.
I’ll give you tangible ways to understand your asset allocation, and the logic behind why your allocation should constantly change with your financial phase, age, and investment time horizon. I see clients often that are confused about their investments, current allocation strategies, and their retirement plan.
I find that many advisers and investors are more interested in their nest egg value. The logical reasoning behind this is that investors go through their accumulation phase looking at their account statements which only show the lump sum value. The common goal is for this VALUE is to create a financially secure retirement. Knowing where your income is coming from and maximizing income during retirement is your key to success.
If I were to ask what’s the color of a dollar bill, what color comes to mind?
Of course green. The color of your money has positive effects and trade-offs that must be considered.
In the investment world, RED MONEY, consists of:
These types of accounts are typically used during the accumulation phase of a retirement account. The positive feature of RED MONEY is the possibility of upside market potential. The trade off is they’re not safe, secure, or guaranteed.
These type of accounts, a lot of analysis, reasoning and logic needs to be applied when considering a RED MONEY option.
GREEN MONEY consists of safe investments such as:
Don’t let this happen to you. You seriously need to consider a Fixed Indexed Annuity a GREEN MONEY alternative. They’re safe, secure, guaranteed and insured. With no loss of principal due to market losses and can provide an income for life that you and your spouse cannot outlive.
The Color of Money Risk Analysis allows us to assess your financial picture and provide a roadmap to your overall risk preferences. The output will be a proprietary Color of Money scoring system. This short, interactive analysis is the first step on the road to retirement.