Prosperity Capital Advisors

The Bucket Plan®

Prosperity Capital Advisors created a planning tool known as The Bucket Plan®, a three-bucket approach to segment money based on purpose and time horizon. If you are nearing or in retirement, The Bucket Plan helps you plan for safe and secure income through your retirement while capitalizing on global markets to grow your assets for distribution in your later years. It was designed to help combat two of the biggest challenges in retirement: inflation and sequence of returns risk.

If you still have a longer time horizon from retirement, The Bucket Plan helps provide liquidity guidance and income tax reduction or mitigation strategies to help accumulate your wealth.

Bucket 1

The “Now” Bucket is designed to be your safe and secure money. Everyone has that magic number that they like to have sitting in the bank as an emergency fund. In addition to that emergency fund, we also recommend you set aside any major planned expenses that are going to be upcoming in the near future. Lastly, if you are retired or about to retire, we also recommend a year’s worth of retirement income in the Now Bucket.

Bucket 2

The “Soon” Bucket is the preservation bucket. It is invested for growth, but conservatively. It is the money you may need to tap into sooner rather than later. This bucket may be accessed for periodic distributions if you need additional money outside of what you have in your Now Bucket, or it may provide income in the first phase of retirement. By investing conservatively, you avoid exposing this bucket to extreme market fluctuations and the risk of having to sell assets for income at times when the market is down. This helps avoid a major risk known as sequence of returns risk by buying yourself a time horizon.

Bucket 3

The “Later” Bucket is designed for long-term growth and legacy planning. Having bought a time horizon with the first two buckets, you may choose to invest in vehicles with a longer time commitment and greater growth potential with confidence. This bucket can play a critical role in legacy planning too, particularly to provide income for a surviving spouse.

“In the Soon Bucket we insure against what can go wrong, to acquire the luxury of investing in what can go right in the later bucket.”

-Jason Smith, Prosperity Capital Advisors CEO | Founder

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