It’s A New Year! Is It Time To Reevaluate Your Financial Plan?

It’s A New Year! Is It Time To Reevaluate Your Financial Plan?

| January 18, 2021
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The new year is in full swing! Hope is on the horizon, and the year is brimming with possibilities. As a yearly financial to-do, you should review your financial plan and reassess where you are and where you want to go and how you and your family can financially thrive. Here are a few items to keep in mind when reevaluating your financial plan.  

Tax Strategy Planning

In the wake of a major election and a change in administration, questions naturally arise about how tax laws could change and how that will affect your wallet. If tax rates increase for your tax bracket, you may want to shift some of your savings allocations to tax-deferred vehicles such as a 401(k) or a traditional IRA. The recent stimulus bill contains several tax law changes, including the ability to roll forward unused FSA funds from 2020, (1) 100% deductible business meals, and penalty-free retirement plan withdrawals for families affected by declared disasters. (2) Because of how often new tax legislation is introduced, tax planning is not a one-and-done deal. Revisit your plan to make some shifts that will help you in the long run. 

Tracking Retirement Funds

As we learned from the Great Recession, it is important to stay proactive when it comes to your cash flow and retirement funds. The temptation to adopt a “set it and forget it” approach can create financial blind spots, especially when the demands of work and family make it challenging to carve out time to review finances. If you have not kept track of your investment accounts, retirement plan balances, and other assets, commit to start keeping a pulse on the health of your family’s finances at least once a quarter, if not monthly.

Insurance Coverage

Inadequate insurance coverage is a common issue that can derail retirement plans, especially in the event of unforeseen health problems or injuries that force individuals to retire early. A 2020 study found that only 54% of Americans have life insurance, and 40% of policyholders reported that they wished they had bought coverage sooner. (3) Life insurance policies are not all created equal, and many policies offer living benefits that you can draw on if you need help paying medical bills or other expenses. It’s prudent to make sure you have the proper policies and coverage for your unique situation.

Estate Planning

Regularly reviewing your estate plan is a crucial component of your financial strategy. Life moves quickly, and it is all too easy to forget how much can happen in a short period of time. Arrivals of new children or grandchildren, health conditions, asset purchases or liquidations (such as buying a new home), marriage/divorce, retirement, unemployment, remarriage, and deaths in the family can make a significant impact on the big picture of your estate plan. 

Let Us Partner With You

Your financial plan is as unique as you are, and should be treated with care. As life happens, your plan should evolve and keep up with legislative changes. Make reviewing your financial plan a priority in the new year. If you’d like to review your financial plan, contact us at (626) 529-8347 or email Ricky directly at ricky@hbawealth.com.

About Haydel, Biel & Associates

Haydel, Biel & Associates is an independent financial advisory firm serving individuals and families near Pasadena, California. The firm was founded in 2004 by Chris Haydel and Ricky Biel with a desire to provide unbiased, client-centered, community-based financial advice. Together, they have built a practice that has grown into a family of caring, smart professionals committed to blending proven investment methodologies with creative financial technologies that make it easier than ever to accomplish your goals. They strive to keep things simple and fun to give their clients peace of mind and alleviate financial stress. HBA Wealth takes care of their clients’ needs first and foremost and goes the extra mile to make their clients’ finances grow. To meet and see how the HBA Wealth team may be able to help, contact them today at (626) 529-8347 or email Ricky directly at ricky@hbawealth.com.

The commentary on this blog/website reflects the personal opinions, viewpoints and analyses of the Haydel Biel & Associates employees providing such comments, and should not be regarded as a description of advisory services provided by  Haydel Biel & Associates or performance returns of any  Haydel Biel & Associates Investments client. The views reflected in the commentary are subject to change at any time without notice. Nothing on this website constitutes investment advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Haydel Biel & Associates manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.

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(1) https://www.marketwatch.com/story/covid-relief-bill-will-let-fsa-money-roll-over-into-2021-a-win-for-parents-and-those-with-live-in-elderly-loved-ones-11608825806#:~:text=Workers%20could%20set%20aside%20up,year%2Dend%20or%20be%20forfeited.

(2) https://www.journalofaccountancy.com/news/2020/dec/tax-provisions-in-covid-19-relief-bill-ppp-and-business-meal-deductibility.html

(3) https://www.policygenius.com/life-insurance/life-insurance-statistics/

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