It means when you require money for your particular goal. It may be short, mid and long term horizon. Without time horizon, Financial Planning is really impossible.
It means how much financial loss you can manage for time being, say few months or years, to achieve your particular goal. It is only applicable for non-guaranteed investment. It is very rare that long term horizon investors lose their money in non-guaranteed investment. Based on risk appetite, the investors can be classified into three categories - conservative, moderate and aggressive.
Each and every life stages have different goals and liabilities. A young person with less/no dependents and liabilities have different goals, rather than a person with dependents and liabilities.
Every individual have their own past investment experience in different asset class and this experience plays a vital role for future investment plan.
A positive net worth personís asset allocation will be different from a negative or equal net worth person.