Five Phases of the Financial Life-Cycle

Being There: the Five Phases of Retirement discusses five phases of the financial life-cycle from the perspective of a financial advisor:

1. The savings phase – "he will be preoccupied with other competing savings objectives...Establishing good retirement-savings habits despite the lure of short-term goals is essential to retirement security because of the miracle of compound interest."
   
2. The increased preparation and visualization phase – "kicking his retirement planning into high gear…save all the raises that he earns in the five or six years prior to retirement."
   
3. The decision phase – "the imminent event of retirement…health and money are more accurate drivers of the retirement decision."
   
4. The retirement transition and lifestyle phase – "immediately after retirement…adjust his spending accordingly…more asset rich and income poor."
   
5. The frailty phase – "health issues, care-giving for a spouse and the loss of mobility."