Financial Spring Cleaning: What to Review, Update, or Toss

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Now that the initial filing deadline for personal income returns has passed, it is good time to review your financial “house” and get things in order.

Here are some suggested things to do:

Secure Your Data
Make back-ups and then back-up some more. Keeping a back-up at a different location than your computer, whether by using an online service or manually storing a back-up off site, such as safe deposit box at your local bank, is important. Also, ensure that your passwords are strong enough to protect your private data online and do not use the same password for multiple sites.
Review How your Assets are Owned or Titled
Not just what the asset is, but how do you own it. If it is an IRA or other retirement account now is the time to review beneficiary designations. Have there been any significant life events that might alter who the beneficiaries might be? Has there been a death, a divorce, a marriage, an adoption in your life to take into consideration? Have children reached the age of legal adulthood?
Do a Beneficiary Check-up
How current is your estate plan? When was the last time you checked who you named as beneficiaries for your retirement accounts or life insurance? Do you need to revise, amend or write a new Will or Trust to reflect where you are in your life’s journey?
Consolidating Bank Accounts, Retirement Accounts or Other Investment Savings
By consolidating you can not only reduce paperwork, but can also simplify record keeping tasks. Too many IRA accounts may make it a bit cumbersome to complete Required Minimum Distributions, so consider merging accounts to better manage the activity. Also, maintain a list of all deposit, credit and investment accounts to include name, location, email address and phone number, along with your account password, for your main contact at each respective organization.
Review Your Insurance Plans
It’s important to review your insurance plans periodically, especially your auto and homeowners. If there are children living at home, then adding an umbrella policy may help with exposure to risks caused by your children. Most major insurance companies make combining policies an affordable option.
Take Video of Your Belongings
When was the last time you walked through your house with the video on your phone recording what you have and how things look?  Do you have a place to store a video for insurance purposes, other than just your home computer, which could be stolen or destroyed in a house fire? It could help greatly at the time of a claim. Again, consider having a safe deposit box at your local bank to store a copy of these digital files.
Do you Have an in Case of Emergency or “Ice” File? 
Where are you storing your passwords and account numbers? Who are your contact people if you’re in an accident or the emergency room? Make sure that you have this information up-to-date and accessible to your emergency contacts.
Purge Old Files
Post tax season is a great time to do some purging and clean up some paper and digital files, but what do you need to keep and for how long?  As a general rule, you should keep tax records for seven years, so those records from 2009 and before can be condensed or shredded or digitalized to open up shelf space.
As you do your financial spring cleaning, if you’re not sure what to keep or you would like to review your investments, financial goals or life insurance coverage, give us a call, we’ll be happy to help.