Did your IRA, Roth IRA or investment account get rebalanced yet?
They should have been.
Unfortunately, many advisers are unable or unwilling to correctly undertake the task for a variety of reasons. Rebalancing is placing a portfolio back into your correct target allocation of diversified US stocks, international stocks, global bonds, alternatives, cash.
Similar to many of you, I grew up with the annual tradition of "Spring Cleaning." Every teenager's idea of a great day. Open the windows, clean the crevices, throw out the junk, and organize the closet. Now that I'm grown up (that is debatable in some circles) and own a home, the funny thing is the same habit is still with me and I actually like it now. Things sure change.
1.) Clean up your Investment Portfolio. Year end is a great time for review in regards to taxable events and Spring is a wonderful time to make sure your investment accounts are healthy. Consider cleaning out (sell) the "dogs" in the portfolio, re-balance overweight or underweight categories. You don't want too many eggs in one basket or not enough diversification in other baskets. Make sure your portfolio is in-line with your current risk tolerance. Another common situation; are you keeping too much cash in the bank (likely at low interest rates) that you are not planning on needing anytime soon?
2.) Organize the Files. File cabinets are notorious as dumping grounds. You know that important piece of information is in there... you are just not sure where. Files also include your electronic files. As you wrap up tax time, consider scanning prior tax years on a secure hard drive. Previous advice was to shred after 7 years but a digital copy may be handy if the IRS ever comes knocking. Consider shredding other unneeded documents (make sure to use a cross cutting model). Remember to organize and clean out your wallet while you are at it.
3.) Review your Security Measures. I bet you keep your house locked and use an alarm when asleep or on vacation. The same security should be true for your computer, your personal identity, file cabinets and a fire proof box or safe. Consider investing in a good self-updating anti-virus software, identity protection services, and a safe (possibly even bolted down to the floor) in a discrete location. And please don't forget to update and change the numerous passwords you use.
4.) Purge and Update your Family Budget. I hope you have established a budget, if not get on it! Check your line items to see if they are still accurate- spending more or less in a category? Have a new expense or an old one to remove? Know where your money is and where it is going at all times!
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