27/07/2022
The hierarchy of financial needs is based on a motivational theory model that psychologist Abraham Harold Maslow created in 1943
1. Manage your money:
Financial protection is the foundation of your pyramid, without it everything crumbles down. You won't last long without it hence you can't move to the next level
2. Building a Safety Net:
On this level, this is where whatever remains from your money after actively managing it, you have to protect it by saving it for an emergency fund or taking out life insurance or health insurance so that your save won't be wiped out by such events like death and sickness.
3. Accumulation of Wealth:
Saving is good but it is not enough if the inflation rate is sucking out your life saving under your nose.
You need to invest in it that can surf through the wave of increasing inflation rates. That is where financial advisors come in to help you surf.
4. Leaving a Legacy:
After you have won against the tidal wave of financial hurdles, you have one more thing to compete against and that is the government itself. All your hard work throughout your lifetime and after you are gone, the government wants a piece of your legacy called the estate tax, before giving it to your descendant. Seems unfair? No s**t but it's the law but there are ways to avoid all of those. There are what we called tax shelters that would protect your asset from taxes and you can get all of these when your reach out to your financial advisor.
You don't have a financial advisor? Don't worry send me a message and let's talk.
