You may have missed some important financial goals in your New Year's resolution list! Below are four financial goals that most people don't usually think about. Completing the items on the list below will help you pursue your financial goals in 2019 and beyond.
#1. Protect Your Assets
- Check your credit report. In the past few years identity theft and fraud has become more and more popular - monitoring your credit report can help you identify if you have become a victim. You can retrieve a free report from annualcreditreport.com from all three agencies once a year. It's a good time to consider hiring a company to monitor your credit and notify you if there are any changes. You may also want to consider freezing your credit like I did after the Equifax hack last year.
- Review your Life insurance needs. If something were to happen to you (or your spouse) how would it affect your dependents? Make sure you have appropriate coverage and that the benefices are up-to-date.
- Change your passwords. It’s a good idea to change your financial account passwords periodically to avoid identity theft and fraud (especially if you use the same password for multiple accounts). Check this list of the most common passwords to make sure your not using a popular password.
- Review and update your estate documents. The primary purpose of a will is to ensure that your assets are distributed to whomever you choose, in the amount and manner that you choose. You may also want to consider establishing a living revocable trust. A trust is an agreement between the grantor (the person who establishes and funds it) and the trustee, who administers it. If you have a living trust you can leave all of your assets to the trust when you die, which can then be doled out by your terms through the trustee. A trust avoids the probate process and allows the heirs access to the trust assets more quickly.
#2. Create a Financial Plan
The key to long term financial success is having a plan. A financial plan provides a road map from your current financial situation to help you reach your future financial goals. A good financial plan will give you confidence and help you understand the steps you need to take to achieve your objectives.
A detailed financial plan includes multiple variables and strategies, covers risk management, asset allocation, tax planning, retirement funding, and estate planning. If you have a large or complex estate creating a financial plan can be confusing and time consuming. I recommend working with a good Financial Advisor who can help you navigate the process and keep you on track. Click here for more information on financial plans. __
#3. Prepare for the Unexpected
- Evaluate your need for Long Term Care, Disability, and Umbrella insurance. Emergencies do happen, and your financial well-being could be undermined by outsized costs that might accompany an illness or injury, job loss, or even a storm that does major damage to your home.
- Create a 6-month emergency savings account. The best line of defense against unexpected events is to have a liquid cash fund that can cover at least six months of living expenses or any large, unforeseen bills that are too high to pay out of your regular monthly income.
#4. Optimize Your Portfolio
- Consolidate your accounts. Do you have several 401(k) accounts from old employers? Multiple bank accounts? Consolidation can make maintenance and analysis easier and help lessen the risk of identity theft.
- Review your investments. Review your investments and make sure you have the proper investment mix and appropriate diversification that aligns with your goals and risk tolerance. Your Financial Advisor should be able to review your portfolio with you, or if you do not have an Advisor, many online investment accounts have built in tools for evaluating portfolio risk.
- Evaluate your fees. Choosing low-cost investments and being aware of how much you are paying in fees can go a long way toward reducing the amount you pay to invest.
The views depicted in this material are for information purposes only and are not necessarily those of Cetera Advisor Networks LLC. They should not be considered specific advice or recommendations for any individual. For a comprehensive review of your personal situation, always consult with a tax or legal advisor. Neither Cetera Advisor Networks LLC nor any of its representatives may give legal or tax advice.
All investing involves risk, including the possible loss of principal. There is no assurance that any investment strategy will be successful.
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