You save and invest to build financial resources that will help you meet your life goals, including a comfortable, secure retirement. Yet investing itself can put those same financial resources at risk. Taking a three-layer approach to the structure of your money and investments can help provide essential liquidity, protect what is most important to you and still let you take advantage of market growth opportunities.
Market risk and the three-layer approach
No one knows whether the future will see the market go up, down or sideways. A downturn at the wrong moment can have a significant negative impact on your portfolio — which can translate to a large dent in your retirement nest egg and your retirement income. That’s particularly true if you need to sell investments at that down moment to cover expenses or meet a minimum distribution requirement.
To manage that risk — and help build a financially secure retirement — you should broadly diversify your money and investments to serve different roles within your plan. One approach is to build three layers into the structure of your portfolio: cash, secure income sources and growth assets.
Layer 1: Cash
Layer 2: Secure Income Sources
Layer 3: Growth Assets
Customize the layers
This three-layer approach can be an effective way to structure your money and investments to reach your goals, including enjoying a financially comfortable retirement. However, every person’s risk tolerance, investing viewpoint, goals, experiences and timelines are different. Those differences can shift the emphasis placed on any given layer, as well as the specific elements within the layer. If you’d like help developing a plan customized to your personal situation, please consult one of our experienced financial advisors.
Investing involves risk, including the possible loss of principal invested. Diversification and asset allocation do not guarantee better performance and cannot eliminate the risk of investment loss.
The information, views, opinions, and positions expressed by the author(s), presenter(s) and/or presented in the article are those of the author or individual who made the statement and do not necessarily reflect the policies, views, opinions, and positions of Hancock Whitney Bank. Hancock Whitney makes no representations as to the accuracy, completeness, timeliness, suitability, or validity of any information presented.
This information is general in nature and is provided for educational purposes only. Information provided and statements made should not be relied on or interpreted as accounting, financial planning, investment, legal, or tax advice. Hancock Whitney Bank encourages you to consult a professional for advice applicable to your specific situation.
Investment products and services, such as brokerage, advisory accounts, annuities, and insurance are offered through Hancock Whitney Investment Services, Inc., a registered broker/dealer, member FINRA/SIPC and an SEC-Registered Investment Advisor.
Hancock Whitney Bank offers other investment products, which may include asset management accounts as part of its Wealth Management Services. Hancock Whitney Bank and Hancock Whitney Investment Services Inc. are both wholly owned subsidiaries of Hancock Whitney Corporation.
Investment and Insurance Products:
NO BANK GUARANTEE | NOT A DEPOSIT | MAY LOSE VALUE | NOT FDIC INSURED |
NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY |