Our Client: Accumulators
What is an Accumulator?
:a person or thing that accumulates things.
Basically an Accumulator is a (younger) person who is still in the growth or “Accumulation” phase of their lives, earning income to live as well as savings some so that they won’t have to work forever. They are basically the opposite of someone retired, who is in the “Distribution” phase of their life, who takes what they have accumulated lives off of that in retirement. Currently Financial Planning and Investment Management is targeted at those about to retire or already retired because they have already accumulated the assets. This works for both sides:
- Retirees need help with regard to how to live off what they have accumulated and not run out of money
- Investment Managers have large sums of money to “manage” and charge fees off of
For these reasons, most Investment Management Firms only focus on those currently with the assets and don’t pay much attention to Accumulators, actually they even call them by a derogatory name, “HENRY’s: High Earner’s, Not Rich Yet.”
At Accumulation Wealth Partners, we emphasize that “YET” and think our client’s Human Capital (their future earnings potential) is a valuable asset that needs to be accounted for and managed as well. We believe:
- Informed investment and financial planning decisions made earlier in life, compound into financially attainable dreams later:
- Accumulators are an
- And often ignored market segment that often sold products (often very expensive/complicated products) rather than offered advice.
- We think they need this advice just as much, if not more than those retirees.
- The majority of their net worth is “unmanageable” by investment management firms because it is either tied up in their 401(k) or equity in the home
- Their lives have more “Major” milestones and changes in this period then any other period of life:
- Business Ownership
- Home Purchases
- College Funding
- The earlier they have access to sound financial advice, the better the opportunity to change bad behaviors and take advantage of the power of compound interest to meet longer term financial goals