Spring Cleaning: A Financial Review

Every spring we shake off the winter tedium, set our clocks forward, pack up the flannel, and clean out the fireplace. All out of necessity and habit. But what about keeping our financial house in order? Too often we go years at a time without looking back at the financial decisions we made. This approach will only compound stress, and cause unnecessary complications down the road. So, rather than waiting until there’s a problem, take the time once a year to tidy up your financial life.

Risk Analysis

Circumstances change. Regularly reviewing your insurance coverage can prevent costly mistakes down the road.

You may be underinsured…

Over time, our assets tend to grow, along with our families. The coverage that worked for us when we were young and starting out may no longer be enough to properly protect everything we value. Take the time to make sure your policies match your current situation, taking into consideration:

  • Family expansions – Look over your Life insurance coverage to ensure the ones you care for are protected.
  • Major home improvements – Make sure your home is properly insured, along with everything in it.
  • Main breadwinner responsibilities – Make sure that your income is set up to be supplemented in the case of disaster. Look into disability insurance, as well as the level of life insurance needed to replace the lost income.

Life happens…

As the saying goes, “life is what happens while you’re planning”. We don’t expect our marriages to end in divorce, or to be hit with a lawsuit that threatens our financial wellbeing and our family’s future. But, these things do happen, and properly preparing will go a long way in avoiding further unnecessary hardship. Consider the following steps:

  • Check and update the beneficiaries on your policies. What worked when the policy was purchased may no longer align with your wishes. Make sure to look at all policies including those through work and those purchased externally.
  • Plan for the unexpected. Protect your assets and future earning potential through an umbrella policy. Homeowner and auto policies will only cover so much in the event of a claim (this amount varies by policy). Should the damages exceed the coverage, you’ll be on the hook for the difference.
  • Self-insure. Look over your emergency fund (if you don’t have one, start now) re-evaluate your “coverage”. Did you have more kids? Did your spouse stop working? You may need to look at increasing the balance for any number of reasons. On the other side, your emergency fund may be overfunded given your situation now, and you can look at better investing the difference.


Just as with risk management, it’s important to regularly review your assets on the road to retirement.

Goals matter…

Rather than working towards an abstract number, track your progress given the goals you have set for yourself. What was important to you in your 20’s can be completely different from what’s important in your 40’s or 50’s. You may find yourself giving up the dream of a beach house for a life closer to family.

Retirement savings…

Take a look at what you’re saving. Has that percentage been stagnant over the years? Many of us make a retirement election when we start a new job, get a promotion or have a life event. This can be for the better, or worse, but either way we should:

  • Contribute a percentage instead of a dollar amount. This way, as you get raises, you automatically will contribute more to your accounts.
  • Make a budget. We can get used to spending what we make, and if you haven’t taken time looking to get a little extra from your paycheck, it’s a great exercise to try.

Account maintenance…  

Gone are the days of working for one company until retirement. A 2015 TIAA survey estimated that up to 30% of Americans have left assets in one or more retirement plan at a previous employer. Of that group, 70% left the funds there for reasons other than being satisfied with the plan. Make sure that doesn’t happen to you by:

  • Checking for orphaned accounts. Consolidating them with your current employer or in an IRA will not only allow you to keep track of the money that’s yours, but it also allows you to review how the accounts are invested. Depending on when you left your previous employer they may no longer align with your current risk tolerance and goals.
  • Verifying and updating account beneficiaries. Firstly, make sure you have beneficiaries assigned to all your accounts. Then, just as with insurance, you want to make sure your money goes to the people you care about, so make sure accounts with existing beneficiaries are up to date. The last thing you want is to have an ex, or parent, as the beneficiary on an account you had in your 20’s when you’re now married with children. An added bonus is that with beneficiaries you can avoid probate as well.

These are only a few easy ways to give your finances a spring cleaning review. Contact a Claris advisor to discuss your specific financial situation.

Share on facebook
Share on twitter
Share on linkedin
Share on email

Related Posts

Preparing for Higher RMDs as a Retiree

The strong market performance of 2023 means this year’s required minimum distributions (RMDs) are very likely to rise for many retirees. For most, we’d expect that retirement accounts have recovered

Read More »