Wealth Creation and Portfolio Diversification Wealth Creation and Management Model To achieve financial freedom, investment should start at an early career age, and continue until early retirement time or time when a person reaches an age when it is best to reduce working hours and spend more time witht he family doing what is more enjoyable. Income up to that time normally continues to rise, and so is the life style. At the time of early retirement or the time to reduce working hours there will be a drop in income and the person will need the supplementary income to continue the life style reached at the time. There are three stages for this investment model based on age, Up to the age of 35 years: the investor can afford to engage in high risk investments at this time period simply because even if the investment was not good, the investor still has the time to recover the funds lost in such investments. Age of 35 - 45 years: theinvestor at this time period in life should focus on medium risk investments. Age of 45 - 55 years: the investor will need to focus on low risk investments that have a high probability of success, simply because the investor will not have the time to recover lost investments due to the fact that retirement is around the corner. After the age of 55 years: at this time the investor should be able start collecting income from the investments made at the early stages of life. The figure below shows the above details graphically, Suggested Portfolio Diversification It is always a good idea for the investor to diversify the investment portfolio. One's own home should not be counted as an investment in real estate, due to the fact one's own home does not generate an income, although it has appreciated considerably in value, although the investor can leverage the equity in own's home, but that will generate an extra monthly payment that adds to the investor's liability. The figure below shows the suggested portfolio diversification graphically,