The most trending tax and financial industry issues.

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Angela Frazier, CPA, CGMA

Partner: Tax, Advisory/Wealth Management, & Human Resources

6 Steps to Give Yourself a Financial Checkup

Working men and women are inundated with daily demands for our time. Between work, family, and trying to fit in some self-care, there can be little time for anything else. As we are squeezed for time, one area often relegated to the back burner is our financial health. Much like an annual physical, have you assessed your financial health lately?

Over the course of our lives, we work hard and need to be sure we are not only taking care of the here and now, but also our future. Here are some things to consider:

1. Emergency Fund

In general, it is recommended you have cash available to cover six to nine months of living expenses. Your emergency fund may be more or less depending on your particular set of circumstances.

2. Retirement

A financial plan to prepare you for your desired retirement, as well as your investment allocations, are critical tools. A 401(k) or other retirement plan is a tax-efficient means of saving for retirement. At a minimum, be sure to contribute enough to the plan to take full advantage of your employer's matching contribution.

3. Disability Coverage

In the event you are not able to work due to an illness or accident, it is important to protect your income stream through disability coverage. One important matter to address is whether the policy covers you for your specific occupation even though you may be able to perform a different occupation. 

4. Long-term Care Coverage

Depending on the level of care needed, the annual costs can range from $20,000 to in excess of $100,000 annually. Many believe Medicare covers long-term care needs, but it does not cover extensive long-term services. According to the National Care Planning Council, the average stay in a nursing home is 835 days. 

5. Life Insurance

Our needs for life insurance can change as we progress through life. When we're younger with children still at home as well as a mortgage and other debts to pay, life insurance can provide the funds to take care of these needs as well as final expenses in the event of an untimely death.

6. Estate Planning

It is extremely important to have a will to make sure your assets are distributed in accordance with your wishes and debts are properly handled. A will is critical when you have minor children so arrangements are made for their care. If you die intestate, the state will direct your affairs. This may result in your wishes not being met, not to mention the substantial probate costs involved.

Overall, it is important to work with a financial planner who can design a comprehensive plan to address all of these areas and ensure you are prepared for all the cycles of your life. If you have questions about your financial health, we'd be happy to visit with you about how we can help. 


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