What can we learn from wine making when it comes to long term financial investment?

Written on the 18 March 2021 by Parkside InvestorPlus

From the start, full disclosure, I enjoy a nice red (or white), regardless from where, if it's had the requisite time to reach its peak.

While not all of us may be wine aficionados, my guess though is that most of us could tell if a wine was drinkable, or not, simply by taking your first sip.

If the aromas and palette are pleasing keep drinking and even keep it to yourself!

If it tastes like cooking wine you probably paid too much for it.

If the taste is supermarket grade vinegar then toss it out and try again.

In wine making, there are many factors that go into making a REALLY good wine these include:

Excellent Vintage & High Grape Quality - the best wines come from the best quality grapes.

No Faults - avoiding faults in the wine making process.

Balance & Complexity - a good wine should display its signature characteristics yet also its own personality.

Fragrant Aroma - in general, wine's aroma is a safe predictor of its excellence.

Good Scores & Reviews - scores and reviews for given wine give it credibility and trust.

Okay, enough about the wine lesson but how does this relate to your financial investments and even more importantly, how to choose someone who you will entrust to set you up for a successful retirement?

What Financial Advisors can learn from the Wine Industry?

As professional financial and wealth advisors, our job is to ensure your assets are put to work to ensure a comfortable and secure lifestyle when you retire and beyond leaving behind a legacy for your loved ones.

And interestingly, how we work is not too dissimilar to that of the wine industry.

Let's assume for a moment we treated your financial assets like a future bottle of a premium bottle of wine.

First,

As a financial planner and advisor, we would choose the most appropriate financial opportunities and products that align with your goals and objectives the best financial results come from the best mix of financial strategies or as the wine maker would say: Excellent Vintage & High Grape Quality.

Next,

In our execution of the financial strategies, we do not take any undue risks that could upset your long term objective our strategies are fully evaluated and measured to ensure we don't miss out on opportunities or worse, move into investments that may sink your retirement nest egg or as the wine maker would say: No Faults.

Then,

We need to ensure we invest across a range of investments that all work together to return the highest possible return so while your stage in life might call for very safe investments that guarantee a regular income, there might actually be other options that may do so while not overexposing you or as the wine maker would say: Balance & Complexity.

Moving on,

Past performance is, by and large, a predictor of future performance so check to see how the financial planner has performed in the past, in times of both growth and downturn - or as the wine maker would say: Fragrant Aroma.

And finally,

What do others have to say about the financial planner's performance how did they rate them, not only on the result, yet also the whole process of dealing with them, how comfortable were their clients in dealing with them, how much trust did they have with their financial planner or as the wine maker would say: Good Scores & Reviews.

So, there you have it financial planners are similar togreat wine makers the only difference is that while you can enjoy a brilliant bottle if red right away you will only be able to savour your success with us in the years to come however, you might then be able to buy as many award-winning bottles of red as you want!

At Parkside, we can help you align your aspirations and values with a financial plan so you can meet your retirement goals.