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Shelly Titus of BKD Wealth Advisors.

By Shelly Titus

October is National Financial Planning Month, making it a perfect time to step back and evaluate your financial goals and consider strategies that will help improve your results. Making positive changes doesn’t have to be expensive or complicated. Here are five steps you can take to help improve your financial life:

  1. Take full advantage of your 401(k) or 403(b) match at work.
    One study suggests Americans may be leaving as much as $24 billion in unclaimed 401(k) company matching contributions on the table each year. This is “free money”—make sure you’re getting yours. Contribute enough each pay period to at least collect the full amount of company match your employer offers. This can have a big effect on your account balance over time. It’s like being given an extra salary increase every year and getting an immediate 100 percent return on your initial investment.
  2. Review your investment accounts at least once a year.
    “Rebalancing” forces you to sell investments that have risen in value (sell high) and put the money into investments that haven’t performed as well (buy low). Over time, a disciplined approach to how you allocate your investments across different types of options can help your account tolerate market risks. This is particularly important following long periods of positive stock market returns (like we’re in currently), when you may find yourself with more stocks in your portfolio. This can lead to more risk than you expect—or want. Many company-sponsored retirement plans offer a periodic rebalancing option that will take care of that process for you. Easy and efficient.
  3. Make a thoughtful choice about when to begin taking Social Security benefits.
    More than 50 percent of retirees start collecting before they’re eligible for full benefits, which “locks” them into a lower benefit for the rest of their lives. Of course, there are times when taking benefits early makes sense. Make sure you review all your options and clearly understand the consequences before making this irreversible decision. Consult a professional if needed.
  4. Monitor your spending.
    One of the biggest potential obstacles a person has to a comfortable retirement is overspending before retirement. As our income increases, we tend to increase our spending at a comparable rate. This “lifestyle creep” makes it increasingly difficult to save enough to maintain the lifestyle you’re used to in your retirement years. What can you do today to help yourself in the future? Start by trying to save at least half of any pay increases, whether from raises, promotions or new jobs. Don’t forget to increase your 401(k) or 403(b) account contributions each year when you can, as this can really add up. Think about it—you were probably living comfortably before the new money arrived. Enjoy some, but save some as well. Develop a spending plan—do you really know where all your money is going? What expenses could be reduced if you needed to save just a little bit more? Going through this exercise is a valuable way to identify spending habits and develop realistic financial planning goals.
  5. Determine if you have enough life insurance.
    While this requires some costs, it may be the best money you spend. Premiums for term life insurance are typically affordable, especially considering the peace of mind they may provide. Life insurance could make a significant difference to your family if the unthinkable should occur.

Your financial plan should be unique to you. Be intentional with your personal financial planning efforts, and do it today. Your plan also should be refined and updated as your life situations change to help you stay on track to achieving your goals. Learn more about our approach to financial and retirement planning at bkdwa.com. If you’d like to speak with an advisor about your plan, please contact Shelly Titus, AIF®.

BKD Wealth Advisors, LLC is an SEC-registered investment adviser offering wealth management services for affluent families and investment consulting services for institutional clients and is a wholly owned subsidiary of BKD, LLP. The views are as of the date of this publication and are subject to change. Different types of investments involve varying risks, and it should not be assumed that future performance of any investment or investment strategy or any noninvestment-related content will equal historical performance level(s), be suitable for your individual situation or prove successful. A copy of BKD Wealth Advisors’ current written disclosure statement is available upon request.