As a weird 2020 comes to an end, it’s important to review your financial position. Here are 2 steps to take:Step 1: Review Your Plan
With a new year right around the corner, make sure to review your:
Social Security Statement to Make Sure Figures are Correct
According to The Motley Fool, many people simply aren’t looking at their statements anymore. For those who don’t, you’re missing the opportunity to make sure the figures are correct. If your earnings history is incorrect or if there are other errors that need to be fixed, and you never check your statements, you will never know. These figures will impact your benefits at retirement.
It is important to have an experienced financial advisor walk you through your Social Security decisions – especially in times like now. At Global View, I, along with financial advisor Joey Hines, recently achieved the designation of Registered Social Security Analyst with the National Association of Registered Social Security Analysts.
If you have questions about these benefits, we’re ready to help.
You can create an account at ssa.gov if you don’t already have one.
Review your current budget and increase your resolve to stick to it. This will help decrease debt and increase savings for essential items.
Review your debt and pay off what you can. You can either follow a snowball method, in which you pay off the lowest bill first, or an avalanche approach, where you work on getting rid of the highest-interest-rate debt first to reduce future interest accruals and increase the principal being paid.
As far as your savings goes, there are 3 major areas to review:
- Your emergency fund (we recommend having three to six months’ worth of spending in an emergency fund; 2020 proved just how fast the unexpected can happen)
- College or any other financial goals
Remember, you are not required to take Required Minimum Distributions (RMDs) in 2020, and if you turned 70-½ after December 31, 2019, RMDs are not required until you turn 72.
At year’s end, it’s always wise to check life insurance and retirement account beneficiaries you have on file to make sure they are still relevant, and then update them, if necessary. You don’t want to leave your hard-earned money to the wrong people, such as ex-spouses, former business partners or deceased loved ones.
Life Insurance Policies
Major life changes will determine if you should add or drop a current insurance policy. Discuss your concerns with a fiduciary financial advisor to make sure your best interests are at heart.
Step 2: Set 2021 Goals and Adjust Savings or Debt Payments
As a new year approaches, it’s wise to review your current plan and make any necessary adjustments. But it’s also wise to address your future. Talk with a financial advisor to make sure you’re on the right path to reaching your goals.
At Global View, we will:
- Sell positions for a tax loss, if it is right for your situation
- Help with distributions or savings as needed
- Help with updating beneficiaries on your accounts
- Help you review your life insurance policies
- If you are close to retirement, we can run Social Security analyses and retirement income/savings analyses for you and discuss your best options