Peter Freeman of Money Magazine summarizes the status, characteristics and investment strategies for different age groups. While there are differences in every group, all are bound to the same economic and investment climate. In the end, financial success depends on how we make decisions based on our assessment of risk and opportunities present.
The 20s: People are relatively new to the workforce and are semi-permanent, relationship-wise. The main concern is saving up for a home deposit or an appealing investment. Before they can start building wealth, the first step is to control or eliminate credit card debt. Building a deposit through investment in equity funds may be a good strategy.
The 30s: Most people in their 30s have settled down, have children and bought a home. The focus is how to reduce mortgage, do renovations, or upgrade to a better property. They are recommended to take out income insurance to counter the threat of downsizing. Moreover, they must save enough for emergency expenses. Single people in their 30s may engage in aggressive investments, including geared share funds or direct share or portfolio investments, with a great deal of caution.
The 40s: Financial comfort at this age group is reflective of how restrained spending was for the past decade. The 40s are a difficult time financially because the kids are grown and education is more costly. Budgeting is crucial. Those who have high incomes may, however, gear up for expanding their investment portfolio.
The 50s: At this time, the children are financially independent, family costs are reduced and salaries are higher. Wealth creation at this period is advantageous and favorable for establishing your own business.
The 60s and later: The 60s is a time to invest one’s savings to generate income during retirement, or to maximize age pension. Investments are usually built around how to allocate pension in order to maximize tax and social security efficiency.
