With the mad rush of tax season behind us, now is an excellent time to review where you are in achieving both short- and long-term financial goals. Here are some key areas that you can examine with your financial advisor to help you stay on track.
Start with your financial plan. It’s important to frequently revisit your financial plan, which should lay out all your financial goals. Evaluate the progress you’ve made toward your goals and consider what you need to be aware of as you head into the future. For example, how does the plan measure up in a rising interest rate environment? Does it account for higher inflation? Remember to review the many variables that can affect your overall financial plan—from higher taxes to a potentially longer lifespan.
Dust off your retirement funding tools. Are you contributing the maximum amount allowed to your employer-sponsored retirement plan or could you allocate more of your income? This is a good time to revisit cash flow and, if needed, make modifications like setting aside a larger percentage of income for your retirement accounts.
Review how you save—and then save more. When it comes to the process of saving, are you paying yourself first? Pay yourself monthly as if it were one of your basic bills. Creating a habit of saving above your regular contributions to an employer-sponsored retirement plan is crucial. If you think you might forget to pay yourself one month, look at automatic payment options.
Ensure you have access to cash. Make sure your emergency fund has enough cash to cover at least three to six months of expenses. It may also be helpful to review the liquidity of your assets or investments as well if you are in the market for a home; accessible cash or line of credit could provide a competitive advantage against multiple bidders.
Update insurance policies. As life changes and major events occur—such as marriage, birth of a child, divorce or a work promotion—so should your coverage. Long-term care, disability and life insurance are tools to protect you from unexpected events that could lead to a financial disaster. Get informed about the benefits of insurance early to determine the best timing for you to get them. It’s always best to be prepared, than be too late.
Make plans for your estate. Be sure to keep your documents (wills, financial accounts, etc.) updated and clear. Be mindful that your beneficiary designations on all your financial accounts are in sync with your intentions and current will. Consider writing a separate letter with a personal message to your heirs as well (in addition to the will).
Have a family wealth discussion. Have a meaningful conversation about money with your family members to set priorities, protect the family enterprise, practice impactful philanthropy and put estate plans in place. Connect with the next generation to engage them in becoming educated about how family finances can affect them.
Spring is a time for rebirth and renewal in many ways—including your finances. Improve the strength of your financial plan and continue to make positive choices with informed actions today for a better tomorrow.
Lisa Taranto Schiffer
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