5 financial things to review annually

Financial Planning Meeting

5 financial things to review annually

Financial Planning Meeting

Five key questions to ask at annual review time:

✔ Is your investment strategy on track?

✔ Are you saving tax efficiently?

✔ Are you protecting your income?

✔ Are you preserving your assets?

✔ How does your plan affect your family?

When are you most likely to do a reality check on your investments? Is it when they’re doing well? Or is it when the markets are down and you’re nervous? Chances are it is the latter, which may not be the optimal time to make investment decisions, particularly if emotions are high. That’s why taking the time to do an annual review of your investments and other financial matters makes sense.

“Careful planning is essential in all economic climates,” says Ann Dowd, CFP®, vice president at Fidelity. “Think of it as if you were driving on a dangerous road. That’s not when you check your brakes and tires. You do that before, so you know they are in good shape.”

An annual financial checkup can take place at any time during the year and can help you better understand the “big picture” of your overall financial planning efforts. You can stop and think about your family’s financial goals, such as saving for retirement, a house, or a child’s education. You can consider reducing taxes on your investments, protecting your income, or building a financial cushion. Once you are clear on your goals, you can then work on ensuring that you are investing appropriately for those goals. And while you are looking at your accounts and holdings, take care of “housekeeping” items, too, like checking beneficiaries and completing a health care proxy, which are not complicated but can have serious consequences if neglected.

Take a long-term view for your family

While all this might sound like a lot of ground to cover, an annual review is well worth the effort when you consider the hard work you have invested in building and protecting your wealth. Says Dowd: “It’s important to have a long-term view of your financial strategies. The annual review can be scheduled at any point throughout the year. It represents an opportunity to reassess your investment and financial situation, while also thinking about future milestones and moments that matter for the people you care about the most.

To read more details about each of these questions in this article by Fidelity Investments, CLICK HERE. If you have questions or would like to review your financial plan please contact Harry Perler or David Olejnik.