When it comes to building a solid wealth management strategy, timing really is everything. While we’ve previously covered how risk can be defined in many ways, a universally accepted definition of it would be not having enough money when you need it. This period of need is often referred to as your “time horizon,” and misestimating it can determine whether you have funds available for use when you need them most.
In this final installment in our five-part series on identifying and working to resolve some of the most common investment portfolio mistakes, we discuss the circumstances and concerns of miscalculating your time horizon. Whether you under or overestimate the time when you’ll need access to your money, and how much you will need to fulfill your requirements at that time, you might unwittingly be exposing yourself to more risk than necessary.