Have You Completed Your Annual Financial Checkup?

It’s the end of the first quarter, which means that the looming tax deadline is fast approaching. Hopefully, you’re almost done reviewing your statements and are finishing up things with your accountant to find out what your tax liability will be. In addition, you now also have a pretty good picture of your finances, which makes now a great time to perform your annual “Financial Checkup”.

Any Major Career Changes?

Have you ever looked back over the last year and had a hard time believing that so much happened in one year? Did you change jobs, receive a promotion, or start a new business? Did you buy or sell your home or another piece of real estate?

Any of these things could have a substantial impact on your current savings goals and income needs. Now is a great time to review your current expenses and savings, and see if there are any changes to be made. If you’ve recently changed jobs, now is also a good time to make sure that you don’t have any old 401(k) accounts lingering around that aren’t being invested properly.

Have Your Goals Changed?

While you’re looking at your retirement plan and brokerage statements, now is a good time to take a good look at your current investment selections. How are your investments performing compared to their respective indices? Are you taking on too much risk? Do you have enough money to retire?

All of these things are important to look at and review on an ongoing basis, especially as you get older. No matter how well your investments have performed in the past, as you near retirement, your risk tolerance decreases, and you need to ensure that your investments accurately reflect those changes. If you don’t take the time to review them now, imagine letting your investments go for years, assuming that everything is going well, only to find out that you are a few years away from retirement, and don’t have nearly enough to meet your goals.

Has Your Family Changed?

In the past year, have you welcomed any new members to the family? Have your kids recently gone off to college, gotten married, or had kids of their own? Have you experienced the loss of a family member or a divorce in the family?

As families change, it is critical to review your account statements and ensure that your primary and contingent beneficiary information is accurate and up to date with your current intentions. The same goes for your estate plan. When was the last time you reviewed those documents? As children grow up, get married, or if there is a divorce in the family, it is critical to ensure that your estate plans are updated to reflect those changes.

If your estate includes a trust, now is also a great time to review the ownership of your accounts and assets. A trust is a fantastic estate planning tool, but it is just a document, and if your assets aren’t properly titled into the name of the trust, then it will not provide the estate planning benefits that you intend for it to do. If you were to pass away prematurely, you may be subjecting your heirs to a lengthy probate process or a substantial estate tax liability if your estate plan is not well-laid out and up to date.

As financial advisors, we see these scenarios daily. Trusts are outdated, beneficiaries haven’t been updated on accounts in 20 years, retirement accounts and insurance policies are underperforming, and the list goes on. Now is a great time to perform your own financial checkup, and seek out a professional advisor with any questions you may have. We assist clients with estimating their net worth, addressing taxes, and updating their retirement and estate plans as needed. This “financial checkup” could turn out to be one of the most valuable things you do all year. Call us today to schedule your complimentary consultation!

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