The Evolution of Money

You Might Hit a Homerun but Make Sure All Your Bases Are Covered First!

162 2 minutes read

How much of your money should be kept “safe” vs “invested” vs “homerun” money as you move through different stages of life?

There is no one-size-fits-all “rule of thumb” when it comes to someone’s risk tolerance and risk capacity, however, there are some basic principles and guidelines that can help you assess if you are on the right track or if you are completely off base.

The Evolution of Money Guide provides a framework and starting point for determining whether or not you have too much or too little money in the “safe”, “investment”, or “homerun” category.

The IFW Evolution of Money Framework

The Safe Bucket: Money is easily accessible and not subject to fluctuations in value. This money should be kept in cash equivalents like CDs, money markets, short-term bonds, and the like.

The Investment Bucket: Money is kept in stocks, longer-term bonds, and real estate.

The Homerun Bucket: Investments that are more speculative in nature. Things like individual stocks, options, cryptocurrency, privately held companies, and the like.

In your 20’s and 30’s keep:

10% of your money in a “safe” bucket.
60% of your money can be directed to an “investment” bucket
30% of your money can be kept in a “homerun” bucket

In your 40’s and 50’s keep:

30% in a “safe” bucket
45% in the “investment” bucket
25% in the “home run” bucket

In your 60’s and 70’s keep:

60% in a “safe” bucket (in addition to cash equivalents you can add annuities to this category)
40% in an “investment” bucket
0% in the “homerun” bucket

The devil is always in the details and many factors must be considered before taking action on any specific financial decisions, however, this Evolution of Money Guide can certainly provide a lot of clarity and confidence on how we position things as we move through the different life stages!

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Please remember, be mindful of the messenger that positions certain products or services as “always” bad or “always” perfect. The fact of the matter is there are no “bad products” or “perfect products”. The right product is the one that aligns with your goals and objectives.

The Institute of Financial Wellness believes when it comes to financial decisions; never say “Never” never say “Always”…It Depends.

Rees Bridges( Senior Vice President, Marketing & Communications )

Rees Bridges brings a unique value to the IFW as both a highly accomplished creative professional and a successful financial services executive to serve in his role as Senior VP, Marketing & Communications.

Over the last decade Rees has served as the lead marketing & communications professional for a Fortune 500 Financial Services firm. He oversaw all advisor marketing strategies, client communications, and the entire firms branding and marketing initiatives.

Rees continues to pursue his passions as a creative professional & musician for over 30 years, with an impressive profile and reputation as a designer, performer, teacher, and studio musician. Here is a little secret: He serves in the role as an international clinician for Mapex drums, Paiste Cymbals and held the record for world’s fastest drummer between 2006 and 2007.

Rees grew up in London, England and currently resides in Miami, Florida. When not at work, he enjoys spending time with family and friends, traveling, and indulging in his passions for music and creative pursuits.

Rees Bridges

162 2 minutes read