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‘Demand Inheritance’ Portfolio Stages

 

  1. The Legacy Stage (0-6 months): 100% Bonds- The Legacy Stage is a low-risk model of investing for those who have just received an inheritance. Safety, security, and short-term bonds are the focus of the Legacy Stage. Short-term bonds are fixed-income instruments that take less time to mature; lower risk/ lower return. These bonds can take between 1-4 years to reach maturity on average. Short-term bonds differ from long-term bonds as they provide greater stability and liquidity, meaning that your money is safely accruing interest while also able to be cashed out and spent or reinvested more quickly. These qualities make them perfect for your initial inheritance investment as your money will be relatively stable and easily reinvested once you have had time to grieve and formulate a game plan for moving on to the next stages of investment.

 

  1. The Patience Stage (6-12 months): 90% Bonds/ 6% stock/ 4% Real Estate- The Patience Stage allows you to keep the security from the Legacy Stage while also offering slightly more market exposure with potential for increased returns. This stage is meant for those who have received their inheritance in the last several months and are ready to move from a conservative to moderately conservative portfolio structure. Keeping the safety of short-term bonds from the Legacy Stage blended with some increased exposure to the stock market and real estate, this stage is like removing the training wheels from your bike. While it may seem a little less stable at first, with a bit of added volatility, there is certainly more room for growth. This applies to both your ability as a bike rider and your newly diversified investments.

 

  1. The Horizon Stage (12-18 months): 70% Bonds/ 20% stocks/ 10% Real Estate)- The Horizon stage truly puts your money to work by placing even more weight into the stock market and real estate, effectively moving from a moderately conservative to a more moderate risk profile. This stage is meant for those who have graduated from the Legacy and Patience Stages and are now ready for the potential for higher returns on their investments. A fully diversified portfolio of bonds, stocks, and real estate remains the primary focus of this stage, with greater emphasis on the higher growth potential of stocks and real estate. This stage ensures your inheritance’s security while maximizing the money made on your investments. Once you are ready to move out of the Horizon stage into a more customized portfolio to match your long-term goals, work with a Financial Advisor to formulate a more personalized strategy.

 

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This report is a publication of Demand Wealth. Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author as of the date of publication and are subject to change.

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