Kick-Start Your Financial Year with These Expert-Recommended Questions
As the first quarter unfolds, it’s an ideal time to connect with your financial advisor and reflect on the past year while discussing the future. A thorough conversation about annual tax rules, budgets, investment performance, and the year ahead can reveal valuable insights and necessary adjustments for your financial plan.
Staying Ahead of Tax Law Changes
Ken Robinson, founder and senior advisor at Practical Financial Planning, emphasizes the importance of addressing tax law changes with your advisor as early as possible. This allows you to adjust and implement new strategies, ensuring you’re ahead of the game. Jennifer Kohlbacher, director with wealth advisory Mariner, adds that tax changes can prompt a range of actions, from updating estate planning documents to allocating funds to 529 plans for the grandkids.
Taking Control of Your Financial Plan
Gregory Luken, founder of Luken Wealth Management, recommends asking your advisor what you can do independently to support your financial plan. With market conditions and personal circumstances constantly changing, it’s essential to reassess and adjust your strategy. Luken highlights that there are only four variables you can control: how much you invest, how long you invest, how you allocate your investments, and what you spend relative to your income.
Aligning Your Portfolio with Your Goals
Jake Falcon, CEO at Falcon Wealth Advisors, stresses the importance of ensuring your portfolio aligns with your financial goals. This means avoiding investments that don’t align with your priorities, such as a retired couple investing in volatile growth stocks. Misalignment can lead to emotional stress, missed goals, and increased risk exposure.
Optimizing Charitable Giving Strategies
Joel Callagan, vice president at Wealth Enhancement Group, suggests discussing giving strategies with your advisor in the first quarter. The Tax Cuts and Jobs Act significantly changed the ability to deduct charitable giving, and your advisor can identify when more aggressive strategies make sense, such as superfunding a donor-advised fund.
Evaluating Investment Performance
Jeff DeLarme, founder and president of DeLarme Wealth Management, recommends reviewing how investments have performed relative to their benchmarks. This conversation can broaden your perspective and initiate a productive discussion about risk, portfolio allocation, and the advisor’s skill at choosing appropriate investments.
Scheduling Regular Check-Ins
Chad Gammon, CFP and owner of Custom Fit Financial, emphasizes the importance of scheduling regular meetings with your financial advisor. The frequency of these meetings depends on your circumstances, but it’s essential to stay connected and adjust your strategy as needed.
By asking these expert-recommended questions, you’ll be well on your way to refining your financial plan and setting yourself up for success in the year ahead. Don’t miss this opportunity to review your goals, money management habits, and investment performance with an experienced professional.
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