Seven financial spring cleaning tips

Seven financial spring cleaning tips

Spring is not only a good time to tidy up your house and yard, but also a good time to review and tidy up your financial matters.

Whether it's cleaning out the cobwebs on your beneficiaries or reviewing your accounts and budget, taking small steps now will help make sure your financials stay in order.

Here are a few commonly neglected areas to tackle:


Update your beneficiaries

Life changes, that’s a fact. Are the beneficiaries for your retirement accounts (IRA, 401(k), 403(b)) and your life insurance up to date? If you’ve recently married, divorced or had kids, revisit the beneficiary selections to make sure that what’s written down still reflects your intentions.

Review your coverage amounts

Do you have enough life insurance and disability (DI) insurance coverage to help maintain your family's current lifestyle if something happened to you? Also, if you are married, consider the need for life insurance on you and your spouse.

Consolidate your 401(k) plan accounts

Do you have a collection of 401(k) plans from previous jobs? If so, talk to a financial professional to see if you would benefit from consolidating them into one account that offers a broad array of investment options as well as reasonable fees. You may be able to roll them over into a 401(k) that you already own or roll them into a new individual retirement account (IRA).

For some people, there can be advantages of keeping the 401(k)s separate, which is another reason to seek counsel from a financial professional.

Retirement check

Use your income reported on your most recent tax return as a guide to determine if you are saving enough for retirement. For a quick assessment, estimate that you’ll need about 70% of your annual pre-retirement income. If you are not on track to retirement, make an adjustment to your 401(k) contribution.

Tune up your retirement plan

As people get closer to retirement, they typically become more conservative in their attitudes toward investing. When was the last time that you reviewed your risk tolerance? See if you need to make any changes to your retirement funds. In addition, returns on your investments may eventually cause your risk tolerance to change over time. Rebalance your portfolio allocations on a regular basis to stay in alignment with your risk tolerance.

Give your budget a fresh look

Think about events that are coming up that might need advance planning. Do you have a plan for college savings or retirement? A financial professional can help you create a plan to meet your savings and investment goals.

There’s no better time to start your financial spring cleaning! Talk with a financial professional to see how he or she may be able to help you.

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