New Resolutions for Your Financial Planning (Part 1)
Skepticism about resolutions is common, but we make them on special occasions in any case! Any time is good for making new moves towards better financial planning, but the start of a new tax period gives you most time to structure your savings and accounts in accordance with provisions of law.
What is financial planning? Tax is an important, but not all of ensuring material security for the rest of your life and those of your dependants. Perhaps you already have a versatile portfolio or stocks and bonds: you may also wish to make a start towards such a goal. It is never too early to too late for adults to start retirement financial planning, and there is always room to resolve to try and do better. Here are some starter thoughts, and we hope to peruse yours soon!
Inflation, Social Security, and Financial Planning
What if the United States to reign in or even to abolish deficit financing? When will the dollar climb out of decline? Are future cost trends in the essential of livings secure? Your financial planner may have assumed that your co-payments and premiums will remain approximately at present levels, with inflation as gentle as it has been in the first decade of this century. Financial planning has traditionally preferred capital safety over high returns. Do consider resolving to aim for higher appreciation, and prepare for regimes of relatively high inflation, with effective reductions in social security.
Financial Planning for New Centers of Power
Does your financial planning assume that the US will continue to dominate global economic processes? Are you excessively exposed to dollar stocks? Hope for the best but prepare for the worst we say! Perhaps your lifetime will continue in US world dominance, but resolutions to own EU, Chinese, and Indian stocks could make long term retirement financial planning more secure.
Technology Appreciation for the Best Stock Picks
None of us can be domain experts in everything. There must be stocks related to our vocations and fields of expertise in which we know more than most others about the future will unfold, but what about sectors you do not understand? List all the assumptions about new technologies that your financial planner has made in preparing your portfolio. Seek out authorities in fields you do not know, and check on new materials, processes, and solutions, that could spring stock surprises.
Risk Management as a Fulcrum of all Stock Investing
All financial planners talk about risk management, so why make any special resolution about that? Some risks could be extremely unlikely though their effects are known to be devastating. Does your portfolio have stocks with unlikely but serious risks? Resolving to take new preventive and contingent measures could make a big difference to your retirement financial planning.