Is Your Financial Plan in Need of an Update?

Share this Article

Home / Articles / Is Your Financial Plan in Need of an Update?

Sep 2021

An important part of a financial plan is keeping it up to date. Life can throw you a lot of curveballs, and your financial plan will need occasional tweaks to adjust for them — whether they’re the kind of changes you wanted or not.
The Times They Are A-Changin’

Major life events often require adjustments to budgets and expenses. There could also be significant tax implications to consider. Here are some changes that should alert you to the need for a financial reevaluation — especially when it comes to their potential impact on your retirement plan.

Marriage or divorce. Depending on the situation, marriage can add new debts and obligations. If you’re combining expenses and incomes while merging households, you might see your situation improve. On the other hand, divorce can be financially devastating. For women over 50, the termination of a marriage can lead to a 45% reduction in standard of living. Planning for this contingency is important as you approach retirement.

Birth or adoption of a child. Parents can expect to spend more than $233,000 when raising a child from birth to age 18. And that doesn’t include the cost of college. Adjust your financial plan after a birth or adoption to make sure you remain on target to achieve all your dreams — for you and your growing family.

Empty nest. You might be able to set aside more for retirement or shift focus to other goals once your last child leaves home. After you send off your first care package, start reviewing your financial plan to see where you might reallocate financial resources.

Buying a home or moving. A new living situation can come with higher — or lower — expenses as taxes, changes in insurance and maintenance costs as well as renovations can significantly impact your budget. Ideally, speak with a financial professional ahead of any move.

Illness or serious diagnosis. The average cost of healthcare in the United States is about $11,000 per person each year. And this number can skyrocket with a major illness or disability. If you have a chronic condition or significant healthcare crisis, it can be helpful to involve a financial professional early on to help you navigate.

Other Finance-altering Life Events:

     Job loss or change

     Pay raise

     Inheritance

     Fire, theft or accident

     Lawsuit

     Death of a spouse

     Starting (or selling) a business

Don’t Go It Alone

All these events can alter your financial trajectory. Reviewing your financial plan periodically is prudent as you navigate life’s twists and turns. You may need to increase retirement account contributions or end up being able to retire sooner than planned. But no matter what’s next, contact your WellCents financial professional for expert advice to help keep your retirement plan on track.

Sources

https://www.bloomberg.com/news/articles/2019-07-19/divorce-destroys-finances-of-americans-over-50-studies-show
https://www.usda.gov/media/blog/2017/01/13/cost-raising-child
https://www.usda.gov/media/blog/2017/01/13/cost-raising-child

Contact Info

120 Vantis Dr #400,

Aliso Viejo, CA 92656


866-240-8591

info@mywellcents.com

© 2021 Wellcents. All rights reserved.