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Rockbridge Wealth Management Process
Step 1 – Establish Financial Goals
- Assess current situation
- Determine future goals
- Calculate required rate of return
Step 2 – Risk Tolerance
Determine ability, need & willingness to take risk
- Willingness: the sleep test
- Ability: too much risk may jeopardize current requirements
- Need: do you need to take market risk to achieve your goals?
Step 3 – Asset Allocation
Structure portfolio
- Develop asset allocation that provides greatest probability of achieving goals
- Global diversification at lowest cost
- Capture only compensated risk
Step 4 – Measure & Monitor
- Compare portfolio to appropriate benchmarks
- Track progress towards goals