Episode 109: SLY – Safety, Liquidity, and Yield

Today’s Prep:

Does your portfolio contain these three qualities of money? How can you create a balanced portfolio? We’ll go through all of it on this episode.

(Click the featured times below to jump forward in the episode)

Equipping Points:

Today we’ll talk about some foundational principles that David’s business and financial security are built on. From his first job in the investment business up until now, David has made sure to balance these three qualities of money.

All investments have these three qualities in varying degrees that make up the acronym, SLY: Safety, liquidity, and yield (or growth). Will you get the money back? When can you get the money back? How much will the money have grown when you get it back? All of those serve as the foundation of the investment choices you have. Unfortunately, you can’t really get all three in the same product.

How do you create a balanced portfolio that includes all three qualities? Where do these investments live? To start, you’ll likely want some cash, whether that’s in a money market, checking, or savings account. These accounts are safe and liquid, but there’s no growth, especially when compared to inflation. What about in stocks, bonds, and mutual funds?

Do annuities provide the solution you’re looking for? How do the different types of annuities work? And how does this pair with the rest of your financial plan? What about real estate? Does real estate provide the qualities you need as a part of your portfolio?

Ultimately, what is your risk tolerance? How will you react when your money is going down in value? It’s not only about how much or what you have, but about how you’ll react? Meeting with an advisor can help you navigate these decisions and make sure you have the right balance of qualities throughout your financial life.

Listen to the entire episode or click on the timestamps below to skip ahead to a particular segment.

[0:41] – What are the three qualities of money?

[2:16] – What qualities do you want in a portfolio?

[3:26] – Why can’t I have all three qualities at once?

[6:27] – What’s a balanced portfolio look like?

[9:22] – What types of annuities could be considered?

[11:17] – What qualities does real estate have?

[14:34] – How does David help clients find the right balance?

Today’s Takeaway:

As you’re putting together your financial life, you’re going to want to strive for some semblance of a balanced portfolio. That doesn’t necessarily mean just your 401(k), it means your financial life.”

– David Dickens

Additional Resources:

PODCAST: 5 Important Retirement Statistics

PODCAST: Are You Counting On Social Security?

PODCAST: Can We Afford to Do This AND Still Have Enough For Retirement?

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More From David:

The host: David Dickens

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