What is Your Financial Life Stage?

One of the first rules of Financial Planning is to determine our Life Stage.  Certain factors such as our age, marital status, family status, and employment status all help determine our Life Stage.

Our Life Stage is one rule of Financial Planning that will help us determine how we should save, spend, or invest our money.

The 5 Financial Stages of Life

Here are the five life stages used in financial planning. Now, you can use this as a guide in planning your finances for your life stage.

Starter

Starter is the first life stage of financial planning.  A starter is usually a single person who spends their money before they save it.  Starters are starting to experience debt and have most likely accumulated some debt already.  The debt is most likely in the form of student loans or student credit cards.  Starters are also experiencing a bunch of financial firsts, such as buying their first car, starting their first job, and moving out on their own the first time.

Builder

Builders are the next stage of financial planning.  Builders may be engaged, married, or have their first child.  Builders are starting to build their lives and their families.  The financial needs of Builders do not yet require the needs of a financial expert; they are financial beginners and therefore seek financial advice from their family and friends.  Builders are also borrowers; they may be applying for their first mortgage. 

Establisher

Establishers are the third life stage of financial planning.  Establishers are usually married and may be upgrading from their first home to a bigger home.  People in the Establisher Life Stage may be planning or having their second (or third) child.  Their finances are becoming more sophisticated and therefore they may seek professional financial advice.  Establishers are savers as their focus is on their future and their retirement.

Accumulator

Accumulators are the next life stage of financial planning. Accumulators are looking for financial convenience as they are almost in the last Life Stage of financial planning.  Accumulators have grown up children and may also have grandchildren.  Their focus is paying off their mortgage and saving for retirement.

Preserver

Preserver is the final life stage of financial planning.  Preservers have no more kids living at home, and they are usually mortgage-free.  Preservers are usually conservative investors who are looking for security and income over growth.  Baby Boomers are usually Preservers who are already retired or will be retiring very soon.  People in the preserver Life Stage are looking for personal financial services and have sophisticated financial needs.

Which financial stage of life are you in?