5 signs it's time to review your financial plan
Life is full of surprises. Finding a big flaw in your financial plan shouldn't be one of them.
To keep your financial plan on track, you need to review it any time there's a significant change in your life.
What's "significant"? Here are five developments you may encounter:
Job changes. A new job with higher pay may mean you can make larger regular contributions to your personal investment portfolio. A decrease in pay -- or losing your job -- may suggest a more conservative investment stance, or a new look at your goals.
Changes in marital status. When you get married, you'll probably want to review your will, as well as beneficiary designations on your insurance policies, pension plan, and your Registered Retirement Savings Plan or Registered Retirement Income Fund. The same applies if your marriage ends because of separation, divorce, or death. Getting married also means there may be spousal tax-saving strategies you can now use.
Major life events. Having a child means new responsibilities and new expenses definite signals that you need to review your whole financial plan, especially your insurance needs. Other major life changes include buying a home, starting your own business, retiring, or becoming disabled.
Market changes. If the economy and the financial markets are heading for a shift, you need to be prepared.
A shift in your investor profile. People change. When you're young, you may be an aggressive investor willing to take risks in return for large potential gains. As you get older, you may be more cautious.It's important to review your financial plan regularly to make sure it's appropriate for the type of investor you are today, not the investor you were five years ago.