2022 Fall Financial Check-Up

Something I’ve noticed after years as a wealth manager is that we get much busier after Labor Day. Summer vacations are over, kids are back in school, and people focus more on their finances. If this describes you, great. Here’s a 2022 Fall Financial Check-Up you can follow catching you up on what happened this summer, providing timely suggestions, and sharing priorities to end the year financially stronger than you started it.

Wait, What Did I Miss?

1. Market volatility and economic concerns. In a July Wealthy Behavior podcast episode, we discussed expecting a recession instead of a soft landing, but explained that it didn’t mean things would be as bad as prior downturns. We also shared why you should feel better about bonds but avoid crypto even though it got much cheaper. I recapped it for you in Things May Not Be So Bad. We continued the conversation in Bad News is Good News? which included portfolio rebalancing thoughts.
2. Tax Planning. Looking to keep more of what you earn? I shared a two-part tax planning framework in Smarter Tax Planning.
3. How to Maximize Your Travel Rewards. As we think about more vacations coming out of COVID-19 and how to pay for them, we recorded a podcast on how to maximize travel rewards, which I recapped here.
4. An investment that’s doing well in this environment. Some real asset strategies are making money this year. They’re an attractive asset class in inflationary environments, which I explained in Investing in Real Assets.

Timely Fall Financial Check-Up Items

• Review your portfolio. In light of the information shared above about this bear market and potential recession, review your accounts to make sure you’re positioned well.
• Variable rate debt. In last year’s fall check-up post I shared that interest rates were likely to rise, which turned out to be true. Your variable rate interest is a lot more expensive than it used to be. If you haven’t figured out how to lower those rates, or pay those loans now, make that a priority.
• Roth conversions. With portfolio values lower, a Roth IRA conversion could make sense. Is an IRA to Roth Conversion Right for Me? explains the strategy and its benefits.
• Tax-loss selling. Harvesting losses in your brokerage account in a tough year can reduce your tax bill in future years. This piece on Tax-Loss Harvesting explains how it works.

Planning Priorities

• With four months left in the year, review your paystub and maximize retirement plan contributions if you’re an employee. Set up a retirement plan to maximize contributions if you’re a business owner.
• Cash is earning nothing. Establish a rainy day fund covering at least 3-6 months of expenses and get the rest of your cash to work. For more, see The Easiest Way to Increase Your Investment Returns.
• Protect your plan and family against early death with life insurance and up-to-date wills and trusts (for details on how, check out You Need an Estate Plan).