Domani Wealth


Spring Cleaning Financial Review

Categories: Insights |
Estimated Reading Time:
4 minutes

Once the weather warms up we throw open the windows and remember we should wash them. And the curtains. And probably the floors. and probably the deck.

After the house is in order from a good Spring cleaning, reviewing your financial “house” is also a perfect project to tackle in the Springtime.

Thinking about your total financial picture can sometimes be overwhelming and maybe even deter you from starting the review process. It may be helpful to break this down into more manageable chunks.

First, let’s start with: What do you have? What might you owe? When we’ve answered those questions, you’ll not only have a financial review, it will also serve as a net worth statement.

As you’re accessing details on your various accounts and assets it’s best to have the most recent statement and information available.

Financial Review

List financial accounts in your name. Add these details to each entry on your list:

  • What type of account is it? (checking account, 401(k), IRA, after-tax investment account, etc.)
  • Whose name(s) are on the account? Are they individually owned or are they jointly held?
  • Where are they held? Are they at a local bank, national bank, an investment firm, etc.?
  • What is the balance in the account as of the date of the statement?
  • What is your percentage mix of stocks and bonds/cash?  If you are able to delineate your mix of stocks and bonds/cash by account, this would also be a great item to note.

List out all other assets you own such as a house, vehicles, life insurance, or other valuables or collections, etc. Include the following information for each asset:

  • Purchase date and price
  • Current estimated value
  • Current value
  • Is the asset insured? If so, at what replacement value?
  • Life insurance death benefit, premium amount, and cash value (if applicable)

List out any liabilities such as a mortgage, a car loan, student debt, etc. Include these details for each:

  • Outstanding balance
  • Amount and frequency of payments
  • Interest rate

The above details are good to go through on a periodic basis, about once a year. Doing so will help you gauge how your assets are moving over time. It can be refreshing to see nest eggs grow, liabilities decrease, and how you’re moving toward your financial goals. It is also a useful summary to have if something were to happen to you and your loved ones needed this information.

During times of financial market volatility and stress, it is important to reassess your risk tolerance as well. If you were able to determine what your mix of stocks and bonds/cash, now is a good time to consider if your asset mix matches your risk tolerance.”

Estate Plan Review

If something were to happen to you, having an Estate Plan may be a strong foundation to help your family preserve their inheritance and reduce risk.

The three main parts of an estate plan are a Will, a Financial Power of Attorney document, and a Health Care Power of Attorney/Living Will.

1. The Will is a document that becomes effective when you pass away. It dictates where your assets go upon your death and assigns someone that you trust to settle your affairs, also known as your Executor/Executrix. If you have minor children, it can also serve the purpose of appointing guardians over those minor children should there be no living parent.

It is important to review this document periodically in case you need to make adjustments, especially if there have been any major changes in your life.

Some assets may not be controlled by a Will, such as accounts with a beneficiary designation. These accounts include 401(k), IRA, Roth IRA, annuities, and life insurance to name a few.  Jointly held property such as a joint with right of survivorship account is also not controlled by a will At the first joint holders’ death the property will simply pass to the other. The surviving spouse’s Will would ultimately decide where those assets will go. Some jointly held assets could add a transfer-on-death designation.

2. The next document in an estate plan, which is sometimes overlooked, is a Financial Power of Attorney. This document typically comes into play when one becomes incapacitated and unable to make decisions. It gives the power holder authority to perform financial transactions, in the event the owner is unable to do so. Because of the important role a Financial Power of Attorney creates, this is another document you should regularly review. If you do not have one, we recommend making it a priority.

3. The last documents in an estate plan are a Living Will and a Health Care Power of Attorney. Similar to a Financial Power of Attorney, the Health Care Power of Attorney document names a power holder to make health care decisions for you in the event you are incapacitated. The Living Will is a document that simply states your desires in an end-of-life situation, such as including a do not resuscitate order. These documents are also very important to review periodically because of their importance to your health, as well as recognizing that situations and relationships may change.

One final Spring cleaning item for your financial review is to update a list of professionals you work with on financial and related matters.  This would include your attorney, tax accountant, insurance agent, and investment advisor. Keeping this list up-to-date and accessible for your loved ones should they need it can be an enormous stress reliever when the time comes.

If you’ve completed your financial review and realized you’d like a more cohesive approach to your finances, a plan to reach your long-term goals, or even some recommendations on legal experts to work with on some of these Spring cleaning items, please get in touch with us anytime to have a no-obligation consultation. You can call us at 855-855-5455, email [email protected], or get in touch with one of our Wealth Advisors!

Important Disclosure

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalized investment advice from Domani. A copy of Domani’s current written disclosure brochure discussing our advisory services and fees continues to remain available upon request.


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