The Blog

September 18, 2019

Is it time for a check-up with your financial planner?

by Paxton Dolan

You probably have check-ups with your doctor and dentist annually. You also probably have your car looked at on a regular basis. Your finances are just as important as being in good health and having a safe car to drive. As you move through the different phases of your life, the occasional check-up with your financial planner can go a long way in making sure you stay on track to meet your goals.

The first group of millennials is about to turn 40.

As a generation, millennials have had a tough time getting off to a good start financially speaking. Thanks to high student loan debt and the impact of the Great Recession, this group now finds themselves struggling to build up emergency savings, often living paycheck to paycheck.

Now that millennials are starting to move into a new phase of life, it’s a great time to consider sitting down with a financial planner and evaluating their financial status and goals. Of course, this is still a good idea even if you aren’t a part of this specific group.

There are many things a financial planner can help you with.

Maybe you are a recent college graduate, dealing with employee benefits and debt management for the first time. Perhaps you have just had your first child (or grandchild!) and are unsure of how to set up a 529 plan. You may be getting ready to retire and want to be sure you have your finances in order before you do so. A financial planner is someone who can guide you through any and all phases of life.

That said, just like when you go to the doctor or dentist annually, there are a few things you can look at with your financial planner on a regular basis. In this post, we’ll be looking at a few of the topics that could be on the agenda during a check-up with your financial planner.

Evaluating your financial goals.

As we mentioned earlier, goals change as you move throughout different phases of your life. The millennials who are turning 40 are a great example. A millennial like myself, recently out of college, is probably focused on debt management. Perhaps his or her biggest financial goal is setting aside money for big travel plans. When that same millennial is turning 40, however, with kids and a mortgage, that big travel goal might no longer be as important. The money being saved there can be shifted to other goals, like saving for college for the kids. No matter how your financial goals shift throughout your life, a financial planner is the best person to ensure that you meet them.

Ensuring your estate planning is up to date.

As we always say, everyone needs an estate plan! This is especially important if you are married and/or have children. If you pass away without an estate plan in place, your money and assets will pass through probate, a process that could take years and significantly reduce their value before they reach your heirs. Allowing your financial planner to help you with an estate plan can ensure that your money is distributed when and how you want it to be. Your planner can ensure that your beneficiaries, the people who will receive distributions from your trust, will, and/or life insurance policy, are updated regularly. They can also help you determine who will make healthcare decisions for you if you are declared incapacitated by setting up an Advanced Healthcare Directive.

Even if you aren’t married and don’t have kids, an estate plan is still a good thing to have! It’s the only way to ensure that your money goes where you want it to after you pass.

Budgeting and managing debt.

We all – myself included – spend money on things we probably don’t need to spend money on. Buying one Starbucks a day, seven days a week, means this money can’t go towards paying your bills or funding any long-term goals. And that’s just one example. Many people have gym membership fees being automatically withdrawn from their accounts although they no longer use that facility, or monthly subscriptions to magazines that they don’t actually read.

Talking through your expenses with a financial planner helps you to see where your money is actually going. It also allows you to identify places to cut back or eliminate unnecessary costs.

Your financial planner can also help you manage any debt you have. The most important thing is to not allow your debt to paralyze you into inaction. Start paying things down right away! Your financial planner can work with you to build a plan that allows you to pay off anything from maxed out credit cards to student loans in the manner and time-frame that you choose.

Updating your risk tolerance.

As your life circumstances change, you will likely find that your appetite for risk changes as well. You may find yourself to be a more aggressive investor when you’re young and have time to make up for any losses. As you get closer to retirement, however, you may find yourself less willing to take risks with your money. Periodic check ins with your financial planner give them the opportunity to ask questions that determine your risk tolerance and ensure your money is invested in a way you are comfortable with.

The best way to stay on track to meet your financial goals is to keep in touch with your financial planner often, and to promptly update them if anything about your situation changes.

You wouldn’t go years without having your teeth cleaned or taking your car in for an oil check, would you? So, don’t do this with your finances! Schedule a financial check up with your planner today, and make sure you are doing everything you should be to stay on track. And, if you don’t yet have a financial planner, reach out to a fiduciary advisor and let them work with you to achieve your goals.