The saying goes, "If you don't manage your finances, they won't manage you." If you don't learn to invest and manage your wealth, it is difficult to maintain a stable standard of living. You might experience sudden wealth one moment and poverty the next.

How can ordinary people manage their investments and finances effectively? People should manage their income reasonably according to different life stages, ensuring a stable income in the future.

Single Aristocrat Phase

The single aristocrat phase is essentially the first stage of life. At this time, individuals have just entered the workforce with no liabilities or pressures. Many young people become confused. In the past, they were restricted by having to ask their parents for money, but now they can earn and spend as they please. Some young people cannot control their spending and fail to save a penny.

In this stage, both assets and liabilities are built from scratch, and youth allows for mistakes. They can invest in higher-risk investment and financial products, such as stocks and futures. Of course, they can also strive to start their own businesses. Being young means having a stronger tolerance for failure, and if the business succeeds, financial freedom can be easily achieved.

Some young people consider real estate as a form of investment and financial management. However, current housing prices are too high, requiring the combined efforts of an entire family to gather a down payment. One might wonder how much further the prices can rise. It is possible that the coming period may not be the best time to buy a house.

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Family Formation Phase

At this time, many people may incur a significant amount of debt due to marriage, buying a house, or purchasing a car. However, this also locks in future liabilities. As long as there are no unexpected events, our income is expected to grow in the future, and the current debts may relatively depreciate.

After forming a family, people's various expenses will decrease due to economies of scale, and income continues to increase. Family wealth will accumulate rapidly, and liabilities will gradually decrease. At this time, it is still possible to invest in high-yield products such as stocks, futures, and bonds.

However, in reality, we should start participating in social insurance from the moment we begin working. Social insurance not only includes old-age and medical care but also covers work-related injuries, maternity, and unemployment. For example, maternity insurance is also very important for women who plan to have children in the future.Family Growth Stage

During this phase, the number of family members begins to increase. Some have one child, while others have two. Gradually, the family size grows, and so do the expenses. Especially now, the costs associated with raising children are quite substantial. Formula, kindergarten, interest cultivation, special classes, tutoring, and school custody, parents who are capable will not hesitate to invest in their children.

Generally, the family's income is about to reach its peak, and the wealth accumulated by the family will continue to grow. However, investments should gradually be withdrawn from stocks and can be shifted to funds, bonds, but generally, the risk level should be below PR3, focusing on conservative investments.

Family Maturation Stage

Children grow up and successfully find employment and get married. To be honest, many families will spend their decades of savings as their children get jobs and marry. In the past, some parents prepared their children's houses in advance, saving a lot of money.

In this era, it's time to consider retirement, and the family's expenses are decreasing. The mortgage has been mostly paid off, income has peaked and started to relatively decrease. Most of the income will be saved by the family to cope with unforeseen needs.

If there are still savings, they should focus on conservative and safe government bonds, large-amount certificates of deposit, and stable bank financial products. Do not overly pursue high returns, and prioritize the safety of the funds.The Age of Retirement

As we enter the age of retirement, the pension and medical insurance premiums we have paid in the past come into play. Provided we meet the conditions for retirement, we will receive a fixed monthly pension, and hospitalization will also be covered by medical insurance reimbursements.

Our pension may be significantly lower than our pre-retirement income, but it will be continuously adjusted in line with the development of the economy and society. This is a very stable benefit that continues until we pass away. Even after death, it can leave behind a certain amount for funeral expenses and consolation money for the family.

After retirement, it is advisable not to touch one's savings unless necessary. By purchasing government bonds and making deposits in installments, one can effectively mitigate spending risks. Moreover, having a substantial amount of savings in old age can at least ensure that the children and grandchildren will be more filial, can it not?

Overall, there are many ways to invest and manage finances, and mastering them all is quite challenging. The most important thing is to choose the investment and financial management methods one is most familiar with, based on one's own circumstances.