The 3 Biggest Year-End Financial Items to Review (that have nothing to do with Taxes)

Change is inevitable and as we look ahead into the new year, now is also a great time to look back at the past year and make sure our current finances reflect any life changes that have occurred.  Many life changes (marriage, home buying, having children, getting divorced, switching jobs) require changes in our existing financial documents and arrangements.  This is a great time of the year to review what we do and do not have in place as we think about the future and plan for the coming year(s).

A few weeks ago we discussed year-end decisions to impact taxes as well as year-end IRA planning.     Today, we’ll review 3 big non-tax-related year-end financial items to review.

1.  Property and Casualty Insurance Review:  It is essential to make sure that you have adequate insurance coverage for your vehicles, homes, and other property.  A few questions to ask yourself when reviewing your policies:

–       Have you purchased any new jewelry or artwork that requires an update to your riders?

  • Do you have the proper deductibles in place?
  • Do you have the appropriate riders on your policies?
  • Have you added any new drivers to your car insurance policies?
  • Have you started a home office?
  • Do you have an umbrella policy

2. Disability, Long Term Care (LTC) Life Insurance, & other Documents Review:

  • Do you have disability insurance? LTC insurance? And life insurance?
  • Have you named the appropriate beneficiaries on your life insurance policies?
  • Have you named the appropriate beneficiaries on your qualified plans and IRAs?
  • Have you named the appropriate beneficiaries on your non-qualified annuities?
  • For your wills, trusts and other planning documents, have you named the proper guardians, trustees, executors, and beneficiaries?

3. For Business Owners: Shareholder Agreement Review:

For business owners, year-end is a good time to review shareholder and/or buy/sell agreements.  Entrepreneurs and business owners often use shareholder agreements as a way to help facilitate the transfer of their enterprise in the event of death, disability, or retirement.  These agreements can be set up in a variety of ways but sometimes, circumstances change and can render the agreement either invalid or obsolete, so it is important to review these documents annually, reviewing specifically for possible changes (valuation, business model changes, market changes) and/or improper funding.

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