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How Healthy is Your Life Portfolio?

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How Healthy is Your Life Portfolio?

Written by admin on . Posted in Financial Planning, Investing, Saving for Retirment, Wealth Management.

For most people, thinking about the economy starts with their personal financial situation. While job prospects, or the health of a business, or prices at the pump all have an impact on how we feel about the economy, the bottom line is really, “How is my family doing?” In order to capture this perspective, LPL Research designed an alternative way for investors to think about markets and the economy, which we refer to as the Life Portfolio. The Life Portfolio provides a snapshot of the U.S. economy from the perspective of a typical American household. And while we use it to look at the bigger picture, it may also provide important insight on your personal financial situation, as you think about how you are doing, where you want to be, and how you can get there.
Taking the Life Portfolio approach means starting with the three most important parts of a household’s finances—income, debt, and assets—and then looking at how they collectively reflect your financial well-being. Examining the U.S. overall, our analysis shows that while income and debt levels have improved since the Great Recession, our assets have seen the most dramatic increase.
The Life Portfolio provides a snapshot of the U.S. economy from the perspective of a typical American household. It is made up of three components, representing the three most important parts of a household’s finances: income, debt, and assets. To help provide a broader picture of how American households are doing, each component (income, debt, and assets) is looked at from two different angles by using two different representative data series. The three data series are each ranked against their history from 1980 to 2016. The rankings are then averaged and re-ranked to get the final value for that component. Once income, debt, and assets have been individually scored, they are also averaged and then re-ranked to get the final Life Portfolio score. Contact Barnes Capital Group to discuss your portfolio today.
Check out this PDF for an in-depth look at The Life Portfolio.
 
 

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