Terry Bork CLU ChFC, President   |   Aurum Insurance Services   |   D: 440-605-7230   |   C: 440-666-6032   |   tbork@auruminsurance.com   |   www.auruminsurance.com

Living the life you want, now and in the future

Goals Based Asset Allocation

It’s time to examine the traditional view of asset allocation and managing risk. Tradition thinking associates asset allocation with Portfolio Management, the optimal mix of stocks, bonds and cash, based on individual risk tolerance. Risk tolerance takes into account investor time horizon and comfort with market volatility and loses. The process includes money manager evaluation, selection, monitoring and reporting. There is a place for this traditional approach, but it is only a partial solution and falls short of addressing the Major Risks to achieving individual financial goals.

Goals Based Asset Allocation provides an alternative strategy that challenges conventional wisdom on how assets are allocated. The first step is to clearly define and prioritize financial goals. Financial goals may include, retirement funding, education funding, retirement income planning, funding health care costs in retirement or maximizing legacy assets for heirs and/or charity.

Applying a ‘goals based’ approach to asset allocation matches the appropriate funding asset, including alternative asset strategies, to the identified financial goal. This process of “asset/liability matching” measures the asset’s effectiveness by how well it addresses the Major Risks.

Addressing The Major Risks

Market Risks

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Excessive Fees

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Income Taxes

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