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Top Four Financial Moves You Need to Make Right Now

Want a peek behind the curtain of how we help our clients gather the low hanging fruit to improve their financial world without eating into the bank account? Here are the top four ideas.

Want a peek behind the curtain of how we help our clients gather the low hanging fruit to improve their financial world without eating into the bank account? Here are the top four ideas anyone can engage starting today to make a monumental difference.


1. Move Your Old 401K/403B/PSP Into an IRA

Rollover your old 401K/403B/PSP (Profit Sharing Plan) to recapture plan administration fees, eliminate unnecessary expenses and gain access to the universe of investment options. Typical 401K/403B/PSP plans limit your investment selection in an attempt to keep your (and their) world simple. Once you leave an employer, you normally have full access to take your 401K/403B/PSP without cost or tax consequences by dropping it into an IRA.

Bonus: Want to gather more low hanging fruit? Consolidate your IRAs, SEPs and ROTHs as much as allowed. Often, many of these have to remain separate, but don’t keep any more than you have to…it’s easy to lose track! Regardless of how many accounts you maintain, be sure you have access to an aggregate view. Your advisor should be able to create this for you along with your current 401K/403B, even if they aren’t managing the account.

2. Rebalance and Reinvigorate Your Portfolio

Has it been more than two years since you’ve taken a proactive look at your investment accounts? Now’s the time to pull your head out of the sand to give your money a fresh chance to become a coordinated workhorse for you again. You’ve probably seen your account bounce around for the past few years amid hopes it would fully recover to the 2007 levels.

Whether your account rebounded to a value deemed satisfactory or still has an imaginary gap to close, two things are certain:

1) The market proved once again it has a mind of its own,

2) Your emotional investment risk tolerance changed as you experienced volatility in your portfolio.

Both concerns are real, and you can’t ignore them. If you don’t want to stay the course and battle the emotional roller coaster on your own, involve outside counsel.

Regardless, look at all your investment accounts in one big picture to ensure your asset allocation matches your risk tolerance. And if the time is right in your financial game plan, heap fuel on the fireby contributing new money to your long term growth portfolio.

3. Cross Examine Your Insurance (Home, Auto, Umbrella Liability, Life, Disability & Long Term Care)

Insurance doesn’t top the list of fun topics you’ll ever bring up…probably because you’re spending more than you want in this category. Which is exactly why you must be crystal clear and fully confident your insurance operates at maximum capacity. Efficient insurance decisions often result in fewer overlaps and gaps, and proper coverage enables you to view insurance as an investment rather than just an expenditure. Someday you’ll be glad you didn’t gloss over this area.

Quick Tip: If you haven’t vetted your home, auto and umbrella liability insurance against other companies within two years, get started now! We’ve seen family after family make tremendous improvements in coverage and/or find a drastic reduction in premium by completing a review.

4. Create a Spending Plan and Determine Your Wealth Building Cash Flow

Have you ever looked at your spending decisions in the rear view mirror and thought, “Wow, where did all our money go? We make too much money to feel this way!”

Change all that by creating a spending spend that gives every dollar a job. On purpose. Before the month begins. Once you have a solid number for what you want to give and live on now, you’ll know the margin you have can set aside for giving and living big later. We call that your Wealth Building Cash Flow, and that’s the fun part of financial planning!

We would love your feedback: Which of these tips do you think you’ll try? What’s your best idea for improving finances with no out of pocket costs? Tell us in the comments below.

This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

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