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Five Things to Review This October: Financial Planning Month

October is financial planning month. That means the end of the year is quickly approaching. This is when we begin to review client accounts, refresh financial goals and plans, and prepare for the season of spending, giving, and… well… eating. As we approach year-end we’ve put together this article with some tips for preparing before things begin to get hectic. See also our year-end financial planning checklist.

Here are the top five things you should be reviewing in October.

1. Review Your Budget: Take a look at how you have spent your money so far this year. There are many apps (such as Personal Capital) and online worksheets that will help you do this. We can also help give you a more in-depth look at your budget if you need additional help. The important thing is to look at where you are spending your money. You SHOULD be earning more than you are spending. Don’t worry – we are not going to recommend that you begin living according to a new stricter budget NOW. Holiday season is coming, we know what that means. However, we will begin the new year with a new budget to meet our goals.

2. Review Your Balance Sheet: Your balance sheet should show all of your assets (cash, investment accounts, real estate, cars, jewelry, etc. as well as all of your debt (mortgage, student loans, credit card debt, etc.). This is one form of account aggregation, showing in one place all of the accounts and assets you have so you can see where you stand. You should understand how your balance sheet has changed over the last year. Perhaps you had a child get married that decelerated savings, changed jobs that allowed you to save more, or made a capital purchase. Remembering and noting all of these will be important for your year end planning.

3. Review Your Retirement Assets:

  • Pre-Retirement: Look at where your assets are compared to where you want them to be. Look at the last 12 months and see how they’ve changed. This is a great time to merge and consolidate your retirement accounts (such as old 410k accounts), rebalance your various accounts that are not professionally managed, and plan for your year-end contributions. Can you max out your 401k or at least take it to your company’s match? Can you afford to make your full IRA contribution? Should you contribute to ROTH or traditional?

  • Retired: Take a look at how your investments are doing, calculate your drawdown and see if it is in line, assess any major withdrawals you are anticipating, and ensure you are overall still on track.

4. Review Your Income and Assess Income Tax Situation: Start to get ready for taxes. Don’t want until January, February, or March. There are many ways you can lower your tax burden by making decisions before the year ends. Catch up to the last 9 months of deductions, receipts, bills, etc. Also, call your CPA or tax professional and request the year-end tax planner. This document should help you start to get organized. If you need a referral to a trustworthy CPA, let us know.

5. Review Your Legal Documents: Our lives change. Because things are always in flux, we need to make sure we don’t forget to review our past decisions to see if they are still the best for us. October is the best time to revisit your will(s), trust(s), life insurance docs, beneficiary designations, transfer on death agreements, retirement plan beneficiaries, etc. Ensure that all accounts are properly titled, and if you have a trust that it is properly funded. If you are not sure, please ask us. We can either answer your questions or put you in touch with a competent professional who can help.

You do not have to do this alone. As always… we are here to help in this process. We offer comprehensive financial planning services for those who request so just let us know what you need – whatever it is. Whatever it is that is causing you to lose sleep at night… if your 401k is properly invested, whether you are really on track to meet your goals, whether your family trust should be updated… just ask. We are here to be your trusted financial professionals and we would love to help you plan for the year end and for your future.

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