As 2016 draws to a close and 2017 approaches, it’s an excellent time to begin making plans for growth in the upcoming year.
According to a study conducted by Fidelity Investments, 37 percent of Americans considered making at least one finance-based New Year’s resolution for 2016, up from 31 percent in the previous year. Those numbers are likely to increase again this year, especially since we won’t have a Presidential election to focus on during 2017. While many people avoid making New Year’s resolutions for fear that they will only break them, the same study indicated that more than half of people who made financial New Year’s resolutions ended the year in better financial shape than when they began.
To that end, below are 9 financial New Year’s resolutions designed to help you grow your wealth in 2017. Enjoy!
1. Set realistic, reachable financial goals
If it seems a bit ironic that our first resolution or goal is to have goals, that’s because this is where most people fail at the outset. Either they don’t have specific financial goals in mind, or they set the bar so high that their goals are virtually impossible to reach, causing them to lose heart and give up. Don’t let the perfect be the enemy of the good: Set your benchmarks now.
2. Prepare for changes in the tax laws
When President-Elect Trump takes office on January 20, 2017, changes in the tax codes will almost certainly follow. If you haven’t already done so, talk to us, your financial advisor, and your tax advisor now to strategize about changes to your estate, financial, and tax plans
3. Review your investment portfolio
The beginning of a new year and the last few days of 2016 are good times to take a detailed look at your investments, to see which investments are performing well, which are not, and where to reinvest and diversify.
4. Review and track your income and expenses and look for ways to get your budget under control
Examine your income and expenses for 2016 so you know your starting point. Then, throughout 2017 pull year-to-date reports so you can identify and correct problem areas before they become out of control. Analyzing your expenses regularly helps you identify when money is being spent on things that have less importance to your long term goals.
5. Look for creative ways to increase income.
If you own or operate a business, are there new strategies you could implement to reach untapped markets or otherwise increase revenue? If you work as an employee, are you due for a raise this year? Do you own any intellectual property you’re not currently exploiting for royalties? Brainstorm, and use your imagination to find additional ways to increase your personal income.
6. Deal firmly with debt.
Debt is dead weight and the interest charges can be an anchor on an otherwise good financial plan. Bite the bullet, and get on a debt reduction or elimination plan in 2017.
7. Review your life insurance coverage.
Your policy may be out of date and not have features now commonly available on insurance policies. Worse yet, you may be underinsured if your family’s financial needs have changed. Put the coverage under the microscope to build an action plan. Once you’ve decided on changes with your insurance advisor, coordinate the beneficiary designation with us, so it completely aligns with your estate planning goals.
8. Review your retirement plan.
If you have a 401(k) or an IRA, how is it performing? Is it time to increase your contributions? Should you roll over to a different plan? If you don’t have a retirement strategy, start now, and get to it. Now’s also a great time to verify that your beneficiary designation coordinates with your estate plan. We’re here to help if you have questions.
9. Plan for your heirs
If you don’t have a trust, consider working with us to establish one in 2017. If it’s been more than three years since your trust was last looked at, it’s time for a checkup. Are there any life changes (e.g., marriage or divorce) that need to be considered and incorporated into your plan? Even if your assets are modest, a trust prepared by a qualified estate planning attorney can provide privacy for your family as well as protect your heirs and legacy from the IRS, creditors, and court interference
“It’s not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for.” - Robert Kiyosaki
This quote reminds us of a couple of important concepts: first, wealth doesn’t come without a plan; and second, we don’t accumulate wealth just for ourselves. Make a commitment in 2017 to set solid financial goals and craft an estate plan that successfully passes on your financial legacy to the next generation.
We are here to help. Call today to schedule an appointment. From our family to yours, have a happy holiday season and a safe and Happy New Year
On January 20, 2017, Donald Trump will become the 45th President of the United States. Earlier in January, the Senate and House will convene with Republican majorities. How you update and manage your estate plan and financial plan under the Republican controlled Congress and Presidency can make a significant difference in your tax burdens and the way your wealth continues to accumulate. We’re here to help guide you during this time of transition and change.
We are monitoring the situation vigilantly, and we are already strategizing for a wide range of potential tax and regulatory changes in order to provide you with the best possible advice about any changes to your estate plan.
Let’s look briefly at how some of the preliminary details of President-elect Trump’s proposals could affect your estate.
Donald Trump’s proposals
Donald Trump has proposed across-the-board reforms in the tax codes, and while he promises to close up some loopholes, the general trajectory of his proposals is toward lowering taxes overall.
You can find the details of his tax plan on his website, but the most pertinent points are:
Remember that any change to the tax laws requires Congressional approval and won’t happen automatically. In spite of Republicans being in control of the Presidency and Congress, there will still be negotiation and compromise reflected in the “final” tax law that comes out of Washington. And remember, the rules are only “final” until the government decides to change them again. This is one reason you must remain in contact with us as 2017 begins.
Recommendations, assuming President-elect Trump’s agenda is put into law
Preparing your estate for the next administration
With all the volatility surrounding this now-concluded election cycle, the only thing of which we can be certain is change. Regardless of whom you supported, any election requires you to take some action to protect yourself. Proactivity is the best way to protect your wealth against any changes to come.
Between now and when President-elect Trump becomes President Trump, you would be wise to schedule an appointment with us for a full review of your will, trust, and estate plan. Depending on your circumstances, there may be actions that need to be taken now, some that might need to wait, and some that need to be back burnered until we know the “final” tax rules that come from President Trump and the Republican Congress.
As always, we are here to help. Give us a call today to schedule an appointment.