Time Horizon
How long until the money is needed.
What is Time Horizon?
Longer horizons can absorb more volatility because there is time to recover from drawdowns, supporting more equities. Short horizons call for stability and liquidity. Clients often have several horizons at once - a house down payment in two years and retirement in thirty.
Time Horizon: a worked example
Money for tuition due in 18 months does not belong in a stock fund.
More terms in Clients, Strategy & Tax
Sole Proprietorship
A business owned by one person with no legal separation from the owner.
General Partnership
Co-owners share management and unlimited liability; income passes through.
Limited Liability Company (LLC)
Limited liability for owners with pass-through taxation by default.
C Corporation
A separate taxpayer - profits taxed at the corporate level, then again as dividends.
S Corporation
A corporation that passes income through to shareholders, avoiding double tax.
Trust & Estate Accounts
Accounts run by a fiduciary - a trustee or an executor - under a governing document.
Foundations & Charities
Tax-exempt organizations investing for a mission, often in perpetuity.
Client Profile & Data Gathering
The financial and nonfinancial facts every recommendation must rest on.