Your Year-End Financial Checklist Seven aspects of your financial life to review as the year draws to a close. The end of a year makes us think about last-minute things we need to address and good habits we want to start keeping. To that end, here are seven aspects of your financial life to think about as this year leads into the next.. Your investments. Review your approach to investing and make sure it suits your objectives. Look over your portfolio positions and revisit your asset allocation. Your retirement planning strategy. Does it seem as practical as it did
Staying Out of Debt Once You Get Out of Debt As you reduce your liabilities, embrace the behaviors that may improve your balance sheet. Paying off a major debt produces a sense of relief. You can celebrate a financial milestone; you can “pay yourself first” to greater degree and direct more money toward your dreams and your financial future rather than your creditors. Once you get out of excessive consumer debt, the last thing you want to do is fall right back in. What steps can you take to reduce that possibility, and what missteps should you avoid making? Step
Basic estate planning documents may not communicate your intentions. There are three degrees of estate planning: advanced, basic, and none at all. Basic is better than none, but elementary estate planning can still leave something to be desired. While appropriate documents may be in place, they may not be able to fully convey what you really want to do with your estate. Have you communicated your wishes to your heirs, in writing? Cut-and-dried, boilerplate legal forms will hardly do this for you. In a wealth transfer strategy (as opposed to a basic, generic estate plan), you share your values and
If you’re going to say “I do,” here are some things you might want to do. Are you marrying soon? Have you recently married? As you begin your life together, it is important for you to start planning your financial future together and putting your finances on the same page. Here are some priorities you might want to write down on your financial to-do list. Plan for retirement. There is a chance that decades from now, many of us who are currently saving and investing for the future might end up millionaires. Actually, we may need to become millionaires.
Wise money moves for parents under 40. As you start a family, you start to think about certain financial matters. Before you became a mom or dad, you may not have thought about them much, but so much changes when you have kids. Parenting presents you with definite, sudden, financial needs to address. By focusing on those needs today, you may give yourself a head start on meeting some crucial family financial objectives tomorrow. The to-do list should include: Life & disability insurance coverage. If one or both of you cannot work and earn income, your household could struggle to
Once widely disparaged, these loans are getting a second look. Too many baby boomers are retiring with insufficient savings. Some of these boomers are “house rich” and “cash poor,” and in response to their circumstances, they may decide to arrange reverse mortgages. That move could make funding their retirements a little easier. Opinions about reverse mortgages are changing. Once saddled with an image problem, they are now seen as potentially useful instruments for producing additional retirement income. They are not without risk, however. Decades ago, reverse mortgages were marketed to senior citizens who were down on their financial luck. Retirees
Are they worthwhile alternatives to traditional LTC policies? The price of long-term care insurance has really gone up. If you are a baby boomer and you have kept your eye on it for a few years, chances are you have noticed this. Last year, the American Association for Long-Term Care Insurance (AALTCI) noted that married 60-year-olds would pay between $2,000-3,500 annually in premiums for a standalone LTC policy.1 Changing demographics and low interest rates have prompted major insurers to stop offering LTC coverage. As the AALTCI notes, the number of LTC policies sold in this country fell from 750,000 in
A good financial strategy is not just about “making money;” it is also about protection. Some people mistake investing for financial planning. Their “financial strategy” is an investing strategy, in which they chase the return and focus on the yield of their portfolio. As they do so, they miss the big picture. Investing represents but one facet of long-term financial planning. Trying to build wealth is one thing; trying to protect it is another. An effort must be made to manage risk. Insurance can play a central role in wealth protection. That role is underappreciated – partly because some of
Do you really want to live without this coverage? If you forgo it, you may pay a high price. Disability insurance is an important insurance coverage that most people lack. Many people think of it as optional – when they think of it at all. Have you thought about it? If you are a parent or a head of household, you should. The odds of a disability are not that long. The Council for Disability Awareness, a non-profit research and education group, estimates that roughly a quarter of today’s 20-year-olds may become disabled at some point in their working lives.1
Certain kinds of coverage may help to sustain you financially in an emergency. You plan for retirement with expectations in mind. You hope to enjoy a certain quality of life, with sufficient income resulting from smart financial choices. Ideally, your future unfolds as planned. But what if the unexpected happens? Will you have the right insurance in place to deal with it? Insurance matters more in retirement planning than you may think. It is seldom “top of mind” in retirement planning conversations, but the right coverage could help you maintain some financial equilibrium in the face of sudden money pressures.
What it is, why people opt for it. Ever hear of critical illness insurance? This isn’t standard-issue disability insurance, but a cousin of sorts. With people living longer, it is a risk management option entering more people’s lives. The notable wrinkle about this type of insurance is that the insurer issues you a lump sum while you are alive. Insurance for a prolonged health crisis. You buy critical illness insurance to help you out in case you are diagnosed with, suffer from, or experience a serious, potentially life-threatening health concern. Now, what does an insurer define as “serious” or “life-threatening?”
What kind of coverage do you need, and why? Do you own a small business? Are you starting one? What kind of insurance should you have? Truthfully, you should consider (and preferably have) three kinds of insurance for your business and its assets. Liability insurance. Absolutely essential. If you run a small business, especially one that provides services of some kind, you will inevitably be sued someday or at least threatened with a suit. Liability insurance will help you if your services or products cause harm to someone or their property. In such cases, liability insurance pays for some or
Millennials have good reasons to obtain coverage now. Do you plan to buy life insurance before you turn 40? Maybe you should. You may save money in the long run by doing so. At first thought, the idea of purchasing a life insurance policy in your thirties may seem silly. After all, young adults are now marrying and starting families later in life than past generations did, and you and your peers are likely in excellent health with a good chance of living past 80. In fact, LIMRA – a life insurance research and advocacy group – recently surveyed millennials
Take a moment to see if you are adequately protected. Not all home insurance policies are alike. Coverage amounts obviously vary, and so do coverage areas. Taking ten minutes to scrutinize what your policy does (and does not) cover is a wise idea.