Many of us set goals or New Year’s resolutions this time of year. Most of those goals seem to revolve around losing weight, getting “in shape”, spending more quality time with the family or improving financial fitness. The financial side is where we will concentrate with this article.
Everyone has great intentions, but they are tough to fulfill. The simplest way to accommodate the financial plan is to make a short checklist and go through it over the course of the year. Keep your goals simple and attainable. Worth remembering, to lose weight you generally only have two variables, exercise and caloric intake, but billions of dollars are spent on trying to figure out how to shed pounds.
First, set your short and long-term financial goals. Decide what ranks most important and so on. It could be shoring up cash reserves, planning for retirement, etc. Create these goals so you might reference them throughout the year.
Next, set a budget. Track your spending to know where your funds are going. The timing is perfect. There is a lot of software available that is easy to use and your banks bill pay and year end credit card summaries are a great help.
Review your investment and savings plans. Get your statements together and go through them to determine what types of accounts you have, pre-tax, after-tax, etc., and review or have them reviewed by a qualified advisor in a holistic fashion. Are you taking the appropriate types of risk or are you speculating when you should not? Should you rebalance accounts or change course? What has worked and what has not? Once you’ve reviewed your investments, set a course to rebalance them appropriately, matching risk to the type of account you own. Remember to take risk appropriate for each account.
Review your insurance and this includes your property insurance as well as your life and disability insurance. Can you save money? Are you adequately covered or is there a new type of policy that can help you? For instance, long term care has changed dramatically over the years. Many find premiums are increasing significantly and wondering whether or not they should keep throwing money at these policies. There are new types of policies that are of tremendous help and savings.
Review your estate plan. This may involve reviewing your wills, trusts, account ownership, insurance and family dynamics. Proper review may involve multiple advisors including your financial advisor, attorney, CPA, Physician and family members at the least. Remember, someone has to take the lead, and that’s either you or someone you delegate this task to.
As you check items off, move on to something else. If you get everything done, reward yourself, you’ve done well. If you need help, call us.
Investment Advisor Representative. Securities and advisory services offered through Cetera Advisors LLC, member FINRA, SIPC. Cetera is under separate ownership from any other named entity.