Life Stages: Here’s A Checklist to Help you Review Your Financial and Insurance Needs

No matter what your situation, your financial success requires careful planning to help ensure your individual goals and needs are met. This checklist is designed to get you thinking about the entire range of your financial needs — not just your investments — so that you can think about planning for financial security even if you face a few hiccups in your life.

Here is a list of questions to consider as part of your planning process.

  1. Have you determined your short- and long-term financial goals?
    Do you consistently review and update them for any changes?
  2. Are you saving and investing sufficient sums to fund your short- and long-term goals?
    By defining goals that are time and dollar specific, you can regularly assess if you are on track to reach your goals, short- or long-term.
  3. Are you making the best use of tax-deferred savings plans, such as IRAs, 401(k)s, and Keoghs?
    Are you contributing the maximum you can? Are you making investment decisions consistent with your investment time frame and risk tolerance? Also, are you satisfied that you worked out the most appropriate way to take withdrawals for both yourself and your designated beneficiaries, with a careful balancing of income tax and estate tax considerations?
  4. Are you concerned about paying for a child’s education? Are you saving and spending in the most appropriate ways?
    Are you using tax-deferred savings, tax-favored loans, and tax credits? Are you striking an appropriate balance between saving in the child’s name (either outright or in trusts) and saving in your own accounts?
  5. Do you have an “emergency fund?”
    Many experts recommend that you have the equivalent of three to six month’s take-home pay in an account where you can get at it quickly. An emergency fund gives you cash to weather a tough period without having to disturb your investment portfolio or sell off any other assets.
  6. Do you have adequate insurance?
    If you die unexpectedly do you have enough life insurance to protect your family? What about disability insurance if you or your spouse couldn’t work for an extended period of time? Most people have auto insurance which is required by law and most homeowners also are required to have adequate homeowner’s insurance, but did you know that it’s just as important to have insurance to protect the contents of your home even if you rent it?
  7. Do you have all of the necessary legal documents in place?
    Is your will up-to-date? How about your estate plan? Do you have trusts for you and/or your spouse and other heirs? What about a living will or other health care directives? Does someone in your family have durable power of attorney to manage your assets if you can’t? Most important, have you told family members or trusted friends where they can find these documents?
  8. Is your credit under good control?
    Is the interest rate on your mortgage the best you can do, or should you be applying for a lower rate? Should you be shopping for a credit card with a lower interest rate, or perhaps for a home equity loan?
  9. If you own your own business, do you have a plan for smoothly passing on that business to family members or trusted employees?
    Are you aware of and planning for any income and related estate taxes? Are you making optimum use of insurance to safeguard your transition plans?
  10. Have there been significant changes in your family this year?
    Births, deaths, graduations, engagements, and the beginning and ending of marriages can all have multifaceted effects on your financial plans. Consider their effect on your own situation. You may want to start a college fund for a new baby, or make a plan for investing assets you’ve inherited, or make provision for your daughter’s wedding next summer. On the other hand, if you have recently divorced, you will want to review the beneficiary designations on your insurance policies and retirement plans.