Unfortunately, there is no ” official” division into life phases. Based on our many years of experience, we can identify four broadly different phases, which, as already mentioned, are very different from each other.
The first phase, which we unfortunately do not have in our own hands, is childhood. Here, the foundation for a solid start in life can already be laid by one’s own parents. Long-term savings models, real estate and the targeted use of tax allowances can thus ensure initial returns and a financially independent life. However, the liquidity requirements of the parents and the financial preconditions are very individual and can therefore hardly be influenced.
With the end of childhood, in the second phase, you now have your finances in your own hands. At a young age, many people are still at the beginning of their career or are studying and often have not yet built up sufficient assets to invest in different areas in parallel. Depending on your personal perception of risk , you can choose a risk-conscious investment strategy. For example, investments in shares or equity funds would be conceivable. These can bring high returns in the long term if the market is entered appropriately. A high return is always accompanied by a higher risk. Therefore, the investor’s risk tolerance should definitely be considered.
Liquidity also plays an important role at a young age. After all, those who do not yet have a great deal of financial security often need money in the short term. It is therefore advisable to keep part of the assets in liquid investments, such as call money or time deposit accounts.
And he third phase, in middle age, many people have already built up solid assets or have stable incomes. The task now is to secure the assets and achieve further financial goals. A balanced investment strategy with a broadly diversified portfolio of stocks, bonds and funds can be the right choice here, but real estate for private use also plays a major role in this phase of life. Issues such as family planning, career and the financial circumstances of one’s parents have an enormous influence on the choice of investment strategy. Liquidity also continues to play an important role, as unexpected expenses or sudden changes in life situations can occur.
In the last phase, in old age, asset management once again becomes particularly important. The main focus here is on preserving assets and generating a regular pension via pension funds and conservative investment strategies. At this stage, it is difficult to increase one’s own assets and it is not possible to do so, at least not by working. Nevertheless, this phase also offers opportunities to further expand the assets.
But inflation should also be taken into account. This is because the purchasing power of assets can decrease due to inflation. A regular review of the investment strategy and an adjustment to the current market situation are therefore very important.