Why Now is a Good Time to do a Financial Checkup

checkupMany of us are diligent about maintaining the “stuff” in our lives… we get regular oil changes in our cars (and have the tires rotated when we think of it), we try to make it to the dentist regularly, and we have the annual inspection of our furnace/air conditioner.  But one aspect of our lives sometimes doesn’t get the attention that it really needs: our financial plans. For lots of folks, we’d almost rather spend time in the dentist chair than gather all of those statements together, along with our previous plans (if we have any), and do a thorough review of where we are, where we’re headed, and if we’re on track for our goals – retirement being the goal of foremost importance to most.  Yes, we may have gone to a financial planner and talked over our financial situation, then implemented well… some of the recommendations.  After that, we put the plan documents on the shelf and have pretty much forgotten about it.

Things Change

As time passes by, things have a tendency to change – and that change is likely to have rendered your financial plans (you do have a plan, right?) hopelessly out of date.  Remember how your financial planner pointed out that the plans you discussed were only a “point in time” review?  And how the projections and recommendations would only be good for a short period of time? Perhaps you’ve changed jobs, had a new addition to your family, or moved to a new home.  All of these things will have had an impact on your financial situation, for sure.  Have you gone back and reviewed your plans to include the changes?  Have you adjusted your insurance coverage to account for the new child?  Have you rolled over the 401(k) plan from your old employer?  These are all things that you need to do to maintain your financial life. Maybe you’re thinking about putting into motion that Roth IRA conversion plan that you and your planner discussed a couple of years ago.  Some of the tax laws have changed since then, have you factored that into your plan?

Final Thoughts

I’m not saying you need to camp out on your financial planner’s doorstep any time something changes – many folks get along just fine in a “do it yourself” mode.  But if you’ve (wisely) chosen to utilize the services of a financial planner in the past and it’s been more than a couple of years – it would likely be well worth the effort to get back together and do a review.  This is especially true if you’ve had any major changes in your life, such as retirement or changes to your family. And if you don’t already have a working relationship with a Fee-Only financial planner, you can always find one at the National Association of Personal Financial Advisors’ website, or the Garrett Planning Network’s website.  Both websites feature “Find a Planner” maps that can help you to locate an advisor to work with.  And of course you could always just give me a call if you like. The point is that it makes sense to update your planning information – even if that just means developing a spreadsheet and tracking your savings, debt reduction, spending habits, and goals.  Without regular “checkups”, things can go awry for you without your knowing about it – and waiting too long between checkups can make small problems much larger that necessary.  So do yourself a favor and get a checkup! Photo by Wikipedia IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication (or in any attachment).

About the author

Jim Blankenship, CFP®, EA

Jim Blankenship is the founder and principal of Blankenship Financial Planning, Ltd., a financial planning firm providing hourly, as-needed financial planning and advice. A financial services professional for over 25 years, Jim is a CFP professional and has earned the Enrolled Agent designation, a designation that qualifies him as enrolled to practice before the IRS. Jim is also a NAPFA-registered financial advisor, which designates him as a Fee-Only Financial Advisor.

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