New Year Financial Checkup

Monday marks Ditch New Year’s Resolutions Day when millions of Americans will have already given up on their goals to improve their lives in the New Year. We could offer some new habits to try to enhance your finances this year, but instead we’ll suggest a few simple tasks with potentially big payoffs.

Retirement Plan

Update your retirement plan. You do have a plan, right? This year you’ll want to increase your inflation estimates and reduce your investment return outlook given where we are today. And note that the 401(k) contribution limit jumped from $19,500 last year to $20,500 this year (if you’re 50 or older this year, you can add an additional $6,500). If you don’t have time to run the numbers, at least make sure that your contributions this year (including any employer match) are at least 15% of your gross pay, or more if you feel like you’re running behind.

Portfolio Asset Allocation

Review the asset allocation of your portfolio. Gather together the 401(k) statements, IRAs, taxable accounts invested for the long term, Roths, and any other retirement assets and look at how they are invested. How much is in large cap stock funds, international, bonds, real estate? Look at the entire portfolio across all of the accounts. Does the mix make sense today?


Tax season is coming up quickly. Gather your documents early this year to get your taxes filed as soon as you can. This may get you a tax refund sooner (or at least more time to pay the balance due) and you can beat any scammers that try to file under your tax ID number and make off with your refund. Your tax preparer will also thank you for not dropping off your documents on April 14th. While it’s too late now to make many adjustments to your 2021 taxes, make a note to do some tax planning later in the year when the tax laws and your income are clearer to see if you can make some tax savings moves before 2022 is over.

Review Beneficiaries

If you get hit by the proverbial bus tomorrow, who gets your stuff? Is it a mess? Does your executor know where your will is and will they be able to get access to your online accounts? Are your beneficiaries up to date? If you haven’t reviewed your estate plan in a while, do it now. Your executor and family will thank you when you’re gone, not just for the assets, but also for not making it a nightmare to sort out.

Investment Return

With 2021 over now, how did your investments do? Have you calculated your net investment return on your retirement assets and compared it to an appropriate benchmark? If you don’t do this each year, you won’t know if your strategy (or your advisor’s) is keeping you on track. Earning 2% less than what you should each year can cost you a small fortune by the time you need it in retirement. See When 2%=$1 million.  Nobody’s portfolio will beat the benchmark every year, but you should at least be keeping pace with it over a 3-5 year period.

Get Started

Have we inspired you to tackle some of these tasks on this wintry weekend? Or are you too busy and maybe numbers aren’t really your thing? We’re here to help with all of the above and more and our team can stay on top of it for you throughout the year. Learn more at our website and set up a complimentary meeting to get started today. You can even grab our questionnaire to give us the info we’ll need from you to do all the work. It’s a small investment of time that can reap big financial rewards and some peace of mind. And you can have the first step done in just five minutes!  Schedule a call or virtual or in-person meeting today.

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