12-Step Plan for Your Finances

Why It Matters:

  • The start of a new year can be a good time to review your financial strategy.
  • Even if you haven’t touched your investment portfolio, shifts in the market can alter your allocations.
  • Life events can impact your insurance and financial needs. Everything from beneficiaries to contribution limits may require your attention.

Chase Squires tkc.profilePicture Written by: Chase Squires | Transamerica
Dec. 31, 2017

5 Min readClock Icon

You know what they say, “A new year, a new opportunity to excel.”

OK, nobody says that, but they should. The start of a new year can be an opportune time to review your financial picture, revisit retirement strategies, and reconsider your spending and investments.

The experienced financial and legal professionals in Transamerica’s Advanced Markets Group offer a downloadable “New Year Checklist” with 12 planning points that can be used by anyone. When you consider how hard you’ll work over the next 12 months, doesn’t it make sense to take a moment to ensure there’s money left over after the bills are paid?

Some steps seem like common sense, but life can get pretty hectic and it’s easy to overlook even simple things. Others may not apply to you, and nobody says you have to participate in all 12. Think of the checklist as a reminder to review your financial situation, your goals, and what steps you want to take in the coming year.

Some steps might only take a minute. For others, maybe this is the year you ask a financial professional for help.

Let’s review:

      1. Look back: Did anything change in 2017 that might impact your finances? New baby? New job? A change in marital status? Life changes can have implications. Someone who went through a divorce probably wants to review the beneficiary listed on his or her retirement account.

      2. Look ahead: Without goals, it’s hard to know where you’re going. Consider, for instance, long-term financial goals. That $20 a week you vowed to save five promotions ago, unless you nailed it, could maybe use some updating.

      3. Prepare: Expect the unexpected, as in that unexpected car repair or hospital bill. Without an adequate emergency fund, you could find yourself in a financial pinch. If you haven’t set aside some accessible cash savings, you might want to consider doing so.

      4. Protect: When you were single, broke, renting an apartment, and riding the bus, insurance may not have been a concern. As circumstances change, you may have more to lose and people you want to protect. The beginning of a new year can be a good time to review your insurance situation, including life, health, liability, auto, and more.

      5. Balance: Even if you haven’t touched your investment portfolio, changes in the markets may have taken it off the course you set last year. And if your finances have become more complicated as the years have gone by, it might be time to consider the help of a financial professional.

      6. Tax time: As your W-2 and 1099s roll in ahead of tax season, you may want to review your tax status. Generally, it’s good to pay your taxes, but you don’t have to be overly generous with the IRS.

      7. Plan contributions: Did you set a workplace retirement contribution level years ago and forget about it? Maybe you got a raise and now you can contribute more, or maybe you turned 50 and have a higher limit.

      8. Your own business: If your part-time hobby turned into a full-time job, you may want to investigate retirement plans for small business owners such as a solo 401(k) or SIMPLE IRA. A financial or tax professional can be a good resource to help choose and administer a plan.

      9. IRA limits: When you’re starting out, a traditional IRA can be the place to invest for retirement while getting a current-year tax break. But if you have a workplace retirement plan and earn more than a set amount, that tax break starts to go away. The limit isn’t as high as you might think, starting at $101,000 for a married couple. Maybe it’s time to switch to a Roth IRA?

      10. OMG, RMDs: Time flies. After a lifetime of investing, is it time to start drawing down that retirement account? If you’re turning 70½ in the coming year, then yes, yes it is. In fact, you’re required to and the penalty is significant if you don’t.

      11. Gift giving: The holiday season is over, but you can still plan out gifts you may want to distribute in the coming year. Is charitable gifting part of your tax strategy? Will you want to help an adult child with a major expense? Make a list and check it twice, because there’s a limit to how much you can give someone without tax and estate concerns.

      12. Trust issues: If you have a trust, you may want to review the investments inside of it and consider your tax strategy. Again, a financial or legal professional could be a helpful part of that review process.

The full New Year Checklist has more detailed information and workbook space for you to write down important details as you review your financial strategies. Download it today.

Why It Matters:

  • Over time, financial affairs can get complicated. If you haven’t already, is this the year you visit a financial professional?
  • Consider reviewing any changes to retirement contribution limits, individual retirement accounts, and any other regulatory changes for 2018.
  • Check your beneficiaries on retirement accounts and insurance policies. You don’t want to unintentionally disinherit a loved one by overlooking a small detail.

Neither Transamerica nor its agents or representatives may provide tax, investment or legal advice. Anyone to whom this material is promoted, marketed, or recommended should consult with and rely on their own independent tax and legal advisors and financial professional regarding their particular situation and the concepts presented herein.

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