Regular Checkups Help Keep You on the Path to Retirement
A regular checkup of your “financial health” is a smart habit.
A financial checkup helps you re-evaluate and rebalance your financial life. Examining your financial health on a regular basis is particularly important as you save for retirement.
Look at where you are today
Start by examining current savings, investments and income.
You’ll need an accurate view of your financial situation and any gaps in it. Ask yourself whether your goals have changed and if your savings and investments still meet them.
Events like a new job, marriage, divorce, selling a major asset, paying off a big loan or getting an inheritance may have an impact, as well.
Once you know where you're going, you can:
- Assess how comfortable you are with risk
- Rebalance or diversify your portfolio
- Weigh options based on your personal needs
- Monitor your progress
Get a check up at least every year
Year-end may be a convenient time for your checkup. With all of your account statements and financial records on hand, you’ll have a clearer and more complete view of your investment picture.
Keep an eye on retirement investments
Saving for retirement should be a top priority. As the timeline to retirement shrinks, make sure your investment mix is keeping you on track.
If your portfolio is producing low returns, you may not be accumulating
enough for a comfortable retirement.
Consider remixing or diversifying your portfolio. You’ll want to increase your return potential by spreading your assets around so that the fluctuations of a single one have less impact on your overall portfolio.
Know that using diversification and asset allocation as part of an overall investment strategy doesn’t assure a profit or protect against loss in a declining market. Investing involves risk, so there’s no guarantee you’ll reach your investment goals.
Tools can help you plan
Saving for retirement requires a long-term perspective, as well as tools and resources to help you plan. Some ideas:
- Evaluate your investments' performance by stacking them up against similar investments or indexes
- Find out if you’re on track financially by getting your retirement readiness score
- Look for questionnaires, guides and calculators in magazines and websites
Take the next step
If you don’t want to go it alone, contact your accountant, banker or investment professional. An annual evaluation of your investments may be part of their regular services.