Prudent Portfolio: Goals-Based Wealth Management, Goals for Every Phase of Life

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By Peter Chieco

Peter Chieco

One approach to investing is to take an initial amount of capital, invest it in a portfolio of blue chip equities, then let it sit and grow until retirement, hoping that your initial investment will have grown to a nice nest egg.

Another approach is to start by asking yourself what you want to achieve with your money. Do you want a second house, a well-funded retirement or to create an impact in the social arena? As you begin to accumulate wealth, you’ll want to reevaluate those goals and review your progress toward funding them.

Consider dividing your investment timeline into three main phases. In the early stages of your life, focus on accumulating assets and diversifying your portfolio to help protect from market shifts. During the middle of your career, review your asset allocation to ensure you are comfortable with both the overall performance and the level of risk you are assuming. As you approach retirement, you may want to shift your goals to preservation of assets and generating enough income for your golden years.

While it might seem easy to stick to the plan based on which phase of life you’re in, it is helpful to remember that goals change over time. Your children eventually will complete their formal education, your business may succeed beyond expectations and no longer require your daily input and your long-awaited trip abroad will come and go.

Simply put, paying attention to your investment portfolio and making adjustments so that it is aligned with your goals can help you pay that tuition bill or fund that retirement home.

This requires regular evaluation of your portfolio as your life changes. The amount of money that would have funded a comfortable retirement a generation ago would run out long before your life does, based on today’s costs. A goals-oriented plan can help put you on a solid track to achieving them.

Peter Chieco is a financial adviser with the Wealth Management Division of Morgan Stanley in Greenwich, Conn. He can be reached at 203-625-4897.

The information contained in this interview is not a solicitation to purchase or sell investments. Any information presented is general in nature and not intended to provide individually tailored investment advice. The strategies and/or investments referenced may not be suitable for all investors as the appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives. Investing involves risks and there is always the potential of losing money when you invest. The views expressed herein are those of the author and may not necessarily reflect the views of Morgan Stanley Wealth Management, or its affiliates. Morgan Stanley Smith Barney, LLC, member SIPC. CRC 2357122 12/18.



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