The start of a new year is an excellent time to evaluate your financial health and ensure you’re on track for your long-term goals. A little maintenance now can lead to big rewards throughout 2025. Here are three key areas to focus on during your financial check-up.
1. Review Your Investment Accounts
Your investment accounts are a cornerstone of your financial future, and the beginning of the year is the perfect time to give them a thorough review. Ask yourself:
Are your investments aligned with your financial goals? Revisit your objectives and confirm that your portfolio reflects your risk tolerance, time horizon, and growth targets.
How did your investments perform in 2024? Compare the performance of your accounts to the benchmarks you set last year. Make adjustments as necessary to stay on track.
2. Update Your Beneficiaries
Life changes quickly, and your beneficiary designations should keep pace. Whether you’ve experienced a major life event, such as marriage, divorce, or the birth of a child, or simply haven’t checked in a while, reviewing these designations is critical.
Key Accounts to Check:
Retirement accounts (401(k), IRA)
Life insurance policies
Payable-on-death (POD) or Transfer-on-death (TOD) bank accounts
Ensuring your beneficiaries are up to date prevents legal complications and guarantees your wishes are honored.
3. Rebalance Your Portfolio
Over time, market fluctuations can shift your portfolio away from its intended allocation. Rebalancing helps you:
Maintain Your Desired Risk Level: Reallocating assets ensures your portfolio reflects your comfort with risk.
Lock In Gains: Selling assets that have performed well and reinvesting in underperforming sectors can keep your strategy balanced.
Stay on Track for Your Goals: Regular rebalancing prevents overexposure to any one asset class.
Tips for a Successful Financial Check-Up:
Revisit Your Budget: Look for ways to reduce expenses and increase savings.
Set Financial Goals for 2025: Identify one or two actionable steps for the year, such as increasing retirement contributions or paying down debt.
Schedule Time with Your Financial Advisor: A professional review can uncover opportunities you might have missed.
Taking the time for a financial check-up at the start of the year sets a strong foundation for the months ahead. By reviewing your investments, updating beneficiaries, and rebalancing your portfolio, you’ll be positioned for success throughout 2025. If you’d like personalized guidance, reach out to our team to schedule a meeting today!
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