Jan. 11, 2022—Many people start off the year with a list of New Year’s resolutions, usually centered around health and personal improvement. This year, however, it may be wise to make an extra resolution to get your financial health in shape. In today’s podcast, Chief Wealth Strategist Alvina Lo shares the top six things you can do in the new year to maintain a healthy wealth plan throughout 2022 and beyond.

New Year’s Resolutions for your Wealth Plan

Hi, thank you for tuning in and welcome to our Emerald Planning GEM podcast series. GEM is an acronym for Get Educated in Minutes. We created this podcast series to help you address some of your most pressing planning concerns in a timely, concise, and actionable manner. I’m Alvina Lo, chief wealth strategist of Wilmington Trust’s Emerald Family Office & Advisory and your host for today’s show. Today I’m going to answer the question, “What is your New Year’s resolution for your wealth plan?”

Happy New Year! It’s 2022, and we’ve made it through another year of the pandemic. With any new year often comes a list of New Year’s resolutions, and while most of them typically center around health and personal improvement, I say, this year, make a resolution for your financial health. Use this time to make sure your wealth plan is in order and make that your New Year’s resolution this year. 

To help you with this New Year’s resolution, I’m going to share with you today the top six things that I believe you need to have in order to have a healthy wealth plan.

  1. Update your financial plan. Did you have any changes in your life last year that altered either your income inflow or expense outflow? Perhaps you got a new job, moved to a new home in another state, sold a business, or made some great investments (or maybe made some not-so-great investments). Have your assumptions and expectation horizons changed? Perhaps you’re planning to retire earlier or now feel better about the economic outlook such that you’d like to make some adjustments to your portfolio and return assumptions. A good and accurate financial plan should evolve along with you, and should be reviewed and, if needed, adjusted annually.  
  2. Update your will and confirm your fiduciary choices. The pandemic has caused many to evaluate their lives and relationships. Is your will up to date? Are your assets left to the people of your choice, and are they receiving those assets the right way? Are they ready for the money and responsibilities now or would they benefit from a longer-term trust? Are the people or institutions named to serve as executor and trustee in your will the best choice for your family right now? Do you even know what your will says? You’ll be shocked how many clients tell me, “I have a will from years ago, and I don’t really know what it says.” These are incredibly successful people running business empires. They know where every dime goes in their business but can’t always say the same for their estate plan. If that’s the case, priorities probably should be realigned. 
  3. Update your ancillary documents, that is, your power of attorney, health care proxy, and living will. Again, the people in your life may not be the same as they were a year ago. Sadly, many of our loved ones have experienced health issues in the last year. Make sure those who you trust to act for you if you become incapacitated are ready, willing, and able to step into your shoes should that need come. 
  4. Ensure proper titling of assets. This one gets missed often. You may have a beautifully written will, and you may even know what it says, but are your assets titled consistently with your plan and in a way that will take advantage of available planning opportunities? Are accounts held in your individual name or in joint name? Is that right? Should your assets be held in a trust or a family entity like a family limited partnership or LLC?  
  5. Confirm beneficiary designations. For non-probate assets, like retirement accounts or life insurance, do you have the right beneficiaries named in the controlling documents? If you had a new child or grandchild this year, is this new love of your life added as one of your beneficiaries?  Remember, these assets pass outside of your will, so while you may have updated your will, it doesn’t mean you’re finished with your plan.
  6. And finally, number six, re-evaluate life insurance needs. This pandemic has showed us that no one is immortal. Do you need life insurance? If so, what is the proper amount of coverage? If you have an existing policy, is it still sufficient and performing properly? Is that existing policy held in trust? If so, is the trustee following all of the necessary steps to administer that trust properly?

I’m a realistic optimist. What does that mean? I hope for the best, and plan for the worst. I think it was Ben Franklin who said: Failing to plan is planning to fail. Don’t let that happen to you. Make this your New Year’s resolution and ensure that you’ve reviewed these top six items we talked about today so that you can have a healthy wealth plan going into 2022.

Thanks again for joining us today. I hope you found our GEM to be helpful. Please contact your Wilmington Trust advisor if you have any questions about how to implement a healthy wealth plan. We would be glad to help you. If you have a topic that you would like us to discuss on a future GEM, please let us know. Send an email to Emerald@wilmingtontrust.com. See you next time!

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