Personal Risk Management
Managing risk is more than just managing investment risk. There are various personal risks and understanding these risks and how they may affect the outcome of your goals is crucial for creating a comprehensive financial plan with strategies that can adapt to your dynamic circumstances.
Longevity
Advancements in healthcare and living standards have substantially increased life expectancy. As men and women are expected to live longer than previous generations this means that one’s capital will have to last longer to fund cash flows further into the future. Your retirement plan needs to span several decades and needs to ensure that you do not outlive your assets so we assume an extra generous longevity in our planning.
Inflation
Inflation erodes the purchasing power of money over time. It can have a significant effect on after-tax cash available to meet your lifestyle needs. Planning involves running different scenarios with a range of inflation rates and incorporates strategies to combat its effects, ensuring that accumulated funds can support your desired lifestyle throughout retirement.
Market Risk, Timing of Drawdown and Investment Strategies
Retirement planning involves a careful assessment of your risk tolerance and investment personality, time horizon and cash needs from your family’s consolidated investment portfolio. It includes ensuring you are appropriately diversified and have strategies in place to weather market fluctuations. At Mirador Corporation, we take care of all of this for you.
When you are relying on your investment portfolio to provide cash flow to fund your lifestyle, the following factors can have a material impact on the ability of the investment portfolio to last throughout retirement years: a) rate of withdrawal; b) market fluctuations and the average rate of return realized; c) the order that the rate of returns are realized; and d) Portfolio drawdown.
Mirador cannot guarantee future performance of your portfolio. However, we understand that capital preservation, reducing drawdown and having sustainable income are critical. The Mirador Triopay programs, which can only be owned by clients of Mirador, addresses all of these factors. It has had a 7% or better distribution for several years now and has robust risk management strategies in place to protect investments and retirement income mitigating the impact of unexpected market fluctuations.
By investing in units of Triopay, you can ensure you are adequately managing your risk in even the smallest of accounts! Hire Mirador to manage your investment portfolio – let us worry about the markets so you can sleep at night.
Emergency Funds
Establishing and maintaining emergency funds is a foundational principle in retirement planning. Even the best lived life can end up needing to deal with an emergency that requires substantial funds.
An emergency fund serves as a financial safety net, providing individuals with the means to address unexpected expenses or a reduction in cashflow due to health challenges or other factors, without derailing their long-term financial goals. The size of emergency fund varies based on individual circumstances, with factors such as health, homeownership, and family obligations. Having a clear understanding of potential emergency scenarios aids in setting realistic savings goals.
Healthcare Costs
The likelihood of healthcare costs increases as you age. And what if you or someone close to you faces a serious illness? An effective plan incorporates strategies to ensure there are resources available to cover these potential costs throughout your retirement years.
If you are interested in learning more about Mirador Corporation, and how we can help you manage your personal risk management then get in touch via the button below today.