The LRB is the number that you need to earn on your portfolio to make your lifestyle goals and aspirations come true.
The LRB process will convert your lifestyle goals and aspirations into your personalized return objective. Additionally, it will act as your custom return benchmark as opposed to a relative and often random benchmark like the S&P 500. The S&P 500 has nothing to do with who you are, so it is a mistake to measure your investing success by it.
Investing success hinges on the integration between the investor’s unique circumstances and the prudent identification of long-term strategies that are positioned to achieve client goals with the highest probability of success.
At SFM, we take a different approach to constructing your portfolio by reverse-engineering your required rate of return (RRR) and using it as your Lifestyle Return Benchmark™.
Remember that there is a tradeoff between expected return and risk and that some investors are strongly risk-averse, while others are more tolerant of risk. Therefore, it is very important that we build you a portfolio that is respectful of your ability and willingness to take risk while also providing you with an above average chance of meeting your LRB objective.