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Have You Had Your Annual Checkup?

Tuesday, April 9th, 2019 | Uncategorized | No Comments

By Douglas Warren

You may initially think I am talking about your annual medical checkup, but actually I am referring to your annual financial check-up.  Just like it is critical to review your medical health, you should take similar care of your financial well-being with an annual checkup of essentials, such as wills and living trusts, life insurance, and retirement funding.  Also, don’t be fooled into thinking you should only have a financial checkup when you get older and are nearing retirement.  A financial checkup may be as important in your younger life.

Read and Review Your Will

When was the last time you read your will?  I must admit a few years ago, I pulled out my will and read through it.  I was surprised how outdated it was.  My choice of personal representative had passed a few years earlier, and it still named my choice of guardians for my children who were in their mid-30s.  While these were important at the time I wrote my will, they were outdated.  I found that some of my interests and desires had changed over time.  It was time to rethink my desires and goals and make them more relevant.  Your beneficiaries and allocations may no longer fulfill your current wishes.  Other important documents such as Powers or Attorney, living wills, and medical directives should also be reviewed or considered if not in place.

Set Financial Goals

Financial goals are simply financial targets and a road map to accomplish them.  Building a retirement fund, creating an emergency fund, and saving money are just a few examples of financial goals.  Setting your goals and evaluating your progress can insure they become a reality.  Knowing how much to invest today to reach a financial goal in the future can better insure success. Monitoring and measuring your progress can reduce the stress and anxiety in planning for your financial future.

Protect Your Personal Security

Request a free credit report and protect your personal data.  Scammers target older individuals as they often don’t understand technological weaknesses and may be more willing to comply with the requests of strangers.  Check the information on your credit reports for accuracy.  Each of the three credit reporting companies – Equifax, Experian, and Transunion – are required to give you a free copy of your credit report every year.  You can obtain your reports at www.AnnualCreditReport.com.

Your Insurance Coverage

This is another review that people overlook.  Failing to review your life insurance could leave you dangerously exposed.  Life insurance is often used for specific events that could occur.  As with my will, my annual review revealed my insurance policies were outdated.  When my children were young and I had a home mortgage, I was concerned about my family’s financial well-being in the event something happened to me.  I selected an amount of life insurance that would financially provide for my family, including educational needs.  As I mentioned, my children were in their mid-30s and already educated and financially dependent.  My life insurance was no longer appropriately structured. While the need to have life insurance at some level remained important, the amount of coverage was no longer appropriate.  Other needs like long-term care and retirement funding were more important.

Analyze Your Retirement Funds

You need to ensure the amount you are saving meets your needs and retirement goals.  You should start setting aside retirement funds when you begin to work.  As we get older, we need to make sure our retirement portfolio has the right mix of assets.  When we are young and years away from retirement, we can take more risk and a more long-term approach to our retirement funding.  But as we get older and the access to our retirement funds is more imminent, we may need to migrate our investments to a more conservative approach.  Also, while some of the funds may be needed in the early years of retirement, some of the funds to be used later in retirement can be invested in a more aggressive manner.  Determining our future needs and the timing of funding can assist in properly structuring our retirement portfolio. Evaluate returns and re-balance your investments as needed.

Plan for the End

Life events such as divorce, marriage, death, and changes in financial circumstances can necessitate changes in our estate and financial plans.  Coordinating your will, trust, life insurance, and investments with your goals can be critical to achieving them.

Evaluating your financial progress can be stressful and overwhelming.  Take control of your future and plan for success.  If you need assistance in conducting your annual review and assessing your progress, the professionals at WarrenJackson can assist you.  Call one of our professionals today.

WarrenJackson CPAs

606 South Main Street in Sweetwater

409 College Street in Madisonville

219 West Broadway Street in Lenoir City

206 N. Hill Street in Athens

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