Six months into the year, most investors glance at their statements, notice the change in value, and move on. However, a mid-year review offersthe chance to ask important questions that reveal whether your financial plan still fits your life as it stands today.
In our last post,we walked through the reasons for and benefits of a mid-year check-in, as well as some of the areas worth reviewing: cash flow, savings rate, contributions, debt, and portfolio alignment.
Now, let’s explore a few ways to evaluate your current situation and how it relates to your existing plan through a series of questions.
While these questions don’t necessarily require you to go in-depth into documents and balances, they do ask you to think more deeply about where you are today:
1. Am I still on pace for the retirement I want? Are the things you’re doing today in service of the specific retirement you envision? Does your plan support the timeline, travel, and lifestyle you have in mind?
It's easy to assume you're on track simply because your account balance looks good and continues to trend upward. But growth alone doesn't confirm you're saving at the rate your specific goals demand. Ensuring you’re on track now is far better than scrambling in your final working years or, worse yet, coming up short.
2. Would I build the same portfolio today, from scratch?This is really a question about risk and whether your current risk tolerance and portfolio allocation still match how much risk you were willing to take five or ten years ago, when. your original plan was created. Careers change, families grow, time horizons shrink, and priorities shift. The risk tolerance and corresponding portfolio construction that made sense at one stage of your life may not be aligned with the next stage.
3. Am I judging my investments by the right yardstick?Scroll through headlinesand you' may see tech stocks soaring or the Dow outpacing your personal portfolio’s performance. It can be easy to compare your portfolio to an index it was never built to mirror, especially during a volatile stretch. The question is whether your investments are performing the way your long-term plan expects them to, which may look very different from what's trending in the news that week.
4. Has anything in my life outpaced my plan? A promotion, a bonus structure, a new child, an inheritance, a divorce — these life changes can also significantly change the financial math around your financial plan, even if everything about your investments is the same. Financial plans are built around assumptions, and when the underlying facts of your life evolve, the plan needs to evolve with them.
5. Have I looked for ways to keep more of what I earn?
Tax strategy isn't just an April task. In fact, the earlier you can plan, the better off you may be. Decisions like Roth conversions, charitable giving, or timing on bonus and deferred compensation income are often more effective when planned earlier in the year rather than scrambling in December. A quick check now or conversation with your advisor can surface opportunities you may well miss in the midst of a year-end rush.
6. If something happened to me tomorrow, would my paperwork reflect my wishes? Beneficiary designations and estate documents need to be revisited regularly. Unfortunately, they’re often completed once and then forgotten about, sometimes for decades. Take a moment tothink about whether what you wanted then still reflects how you feel and the life you have now. Also consider a quick review to confirm your will, powers of attorney, and beneficiary forms. It’s a small task, but one that could have big consequences if overlooked.
7. What's one proactive move I can make now? What can you do today to get ahead of the curve rather than waiting to react later? It could be rebalancing, increasing a contribution, putting more toward debt, or simply revisiting and refining a goal. Not every decision needs to be reactive. There’s always something we could do now that we’llbenefit from later. Get in the habit of making deliberate adjustments on your own timeline.
A Springboard to Deeper Discussion
The goal of this exercise isn’t to offer answers to the questions asked. It’s to get you to reflect on key aspects of your financial life and consider whether adjustments are needed. None of these questions require a concrete answer today. Take time with them. Often, these exercises serve as a springboard to a deeper discussion with a financial advisor that ultimately leads to a stronger, more aligned plan.
If you'd like help working through these questions with a clear view of your full financial picture, we're happy to talk it through.