We all face a number of significant life-stage changes that require us to stop, examine our financial plan and make any necessary changes. Here’s a quick review of how you might adjust your financial plan to account for five major life transitions:
1. A CHANGE IN MARITAL STATUS: Reassess income, assets, titling of assets (such as real estate), beneficiaries listed for insurance and savings and investment accounts, estate plans and retirement projections.
2. JOB CHANGE: List what you can expect for income and how you might adjust expenses. Consider changes to insurance, taxes and your retirement savings plan and reassess your long-term financial strategy.
3. THE BIRTH OF A CHILD: Review life insurance benefits, estate plan and college savings options such as 529 plans. Possibly increase your emergency fund.
4. A CHILD ATTENDING COLLEGE: Revisit spending and savings estimates in light of your new costs, as well as plans for managing debt.
5. RETIREMENT: Review your budget, and make sure your investments offer the right mix of stability and growth potential. Construct a plan for generating income from savings, including the order in which you’ll draw from your accounts.
For more tips from Charles Schwab, visit Money.gather.com.
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Comments: 6
Also, how people reassess and adjust financial plans when the unexpected happens, such as the birth of a special needs child, an illness, a tragedy? Thanks!