Each person is unique. We are composed of many variables, such as genetics, family influence, geographic influence and even the birth order among siblings – a veritable combination of the forces of biology and society.1 So when it comes to managing your finances, the debate isn’t about nature versus nurture; it’s both.
For example, consider two siblings raised in the same household: same socio-economic background, same parental influence, even the same level and type of education. Yet one sibling is a saver while the other is a spendthrift. Why is that?
We can’t always control whatever personal characteristics drive our needs, desires and indulgences, but we can learn to manage them responsibly. One way to pursue your financial goals is to work with an objective and knowledgeable financial advisor, a role we’re proud to fill for our clients. We can research and analyze your financial needs and objectives to help match appropriate investment and insurance products for your financial situation.
While self-knowledge is important, so is investor knowledge. Knowing how and where to invest isn’t an instinct we’re born with, but takes time and effort. If you’re wondering where you currently stand with financial literacy, consider taking the investor quiz at the Financial Industry Regulatory Authority (FINRA).2
Investors tend to fall into various personality types. According to psychologists who study financial psychology, financial personality types can run the gamut from hoarder to social value spender to the ostrich (i.e., the proverbial “head in the sand”).3 To help counteract any obstacles that may be driven by your financial personality, one strategy is to focus on your goals. We may have very tangible components that influence our financial goals, such as the timeline for needing specific funds, the amount we’ll need and our personal tolerance for market risk. These three factors are instrumental in determining where and how to invest your money.4
When it comes to investing with the goal of creating retirement income, designing your retirement plan may become even more complex. Not only should we take into consideration our household budget and all the travel, philanthropic and expensive items on our bucket list, but we also must weigh the potential impact of additional factors, such as:
The point is, even if we are natural savers, ongoing students of financial education, experienced investors or obsessive planners, there are still plenty of unknowns that can potentially knock us off course.
But the more we know, the better prepared we can be.
1Martha C. While. Money. April 8, 2016. “Blame Your Brothers and Sisters for Making You Messed-Up About Money.” Accessed Aug. 18, 2017.
2FINRA. 2017. “Investor Knowledge Quiz.” Accessed Aug. 18, 2017.
3Naomi Rovnick. Financial Times. Jan. 12, 2017. “Six financial personality types — which one are you?” Accessed Aug. 18, 2017.
4Michael Finke. ThinkAdvisor. July 3, 2017. “What’s the Point of Investing?” Accessed Aug. 18, 2017.
It can be difficult to make financial decisions without access to information. If you have questions or concerns about your current retirement strategy, feel free to contact us using the form below.
Strategic Wealth Designers, LLC is a Registered Investment Advisor in the states of Kentucky and Indiana. Matt Dicken, Dustin Stanley and Jordan Schwartz are Investment Advisory Representatives affiliated with Strategic Wealth Designers, LLC. The advisors may not transact business in states where they are not appropriately registered, excluded or exempted from registration. Individualized responses to persons that involve either the effecting of transaction in securities, or the rendering of personalized investment advice for compensation, will not be made without registration or exemption.
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The retirement kit is provided for informational purposes only. It is not intended to provide tax or legal advice. By requesting this report you may be provided with information regarding the purchase of insurance and investment products in the future.