Make Your List and Check It Twice

Mark P. Bernier |
Posted on Dec 05, 2018

As we dash into the holiday season, many of us are preparing lists --- holiday card recipients, gifts for friends and family, or menu items for festive meals. Reviewing your financial plan, preparing for tax season, and rebalancing your portfolio may not be on your list during this busy time, but I encourage you to consider adding these important tasks to your annual year-end routine. 

Change Your Passwords
Information security is now a part of everyday life. Although many news articles and broadcasts highlight occurrences of high-profile data breaches and identity theft, the thought of changing a password for many of us still feels painful.  While some web-based services require regular password changes, others do not.  Make it a habit to change your passwords at year-end and at regular intervals throughout the year. 

Review Beneficiary Designations
A wide variety of financial assets and accounts allow or require the owner to designate beneficiaries.  A few examples include 401(k) plans, Traditional and Roth IRAs, and life insurance.  Any number of life events could affect your beneficiary designations including a marriage or divorce, birth of a child, or death of a loved one.  Reviewing your designations annually ensures your assets convey to those you intend.

Review Your Estate Planning Documents
If you do not have a will, power of attorney, or living will, I encourage you to seek legal counsel with experience in drafting these documents. For those who have executed these documents, an annual review ensures they still accomplish what you intended for your estate. If you have named individuals to act as executor or power of attorney, are they still capable of executing those duties?  Are there philanthropic desires for your estate not previously addressed?  Estate plans may change for a variety of reasons; be sure yours reflects your intentions.

Prepare for Tax Season
Review your most recent tax return and record the various sources of tax information you received.  Also, be sure to note any potential new sources of tax documents, such as a new investment account you established during the year or any new sources of retirement income.  Keeping a list of those tax document sources will help ensure you have all of the necessary information for your tax advisor to prepare your filings.

Rebalance Your Investments
Portfolio rebalancing is one of the most important actions investors execute. By periodically rebalancing a portfolio, an investor realigns the investments with the predetermined asset allocation and risk profile.  Has recent market volatility skewed your asset allocation?  Has a life event warranted a change in your investment needs or goals? Review your asset allocation or talk with an advisor about the asset allocation that is right for you.

Enjoy the holiday season and some peace of mind by addressing these matters annually by year-end. Crossing these items off your list now will help ensure an organized and successful new year!

Mark P. Bernier
CFA, Senior Vice President/Wealth Management Officer