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Now that April is here, you might decide
to spruce up your home, both inside and
out. But you also may want to do a
little spring cleaning to help keep your
financial house in order.
What steps should you take
to tidy up your financial situation?
Actually, some of the moves are the same
as those you use to reinvigorate your
house and yard. Consider the following:
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Get the clutter out. When you open
some of your closets, you probably
ask yourself: "Why on earth do I
need that?" Strange as it may seem,
when you open your investment
portfolio up for examination, you
might have similar thoughts. Perhaps
you've had some investments for so
long that you no longer remember why
you bought them. If you are not sure
why you own a stock, bond or other
type of security, you might want to
sell it and use the proceeds to
invest in something else that might
be more useful in helping you meet
your goals.
-
Rearrange the furnishings. Over
time, and almost without your being
aware of it, the furnishings in a
room can get out of balance. Perhaps
you have too many chairs in one
corner, or maybe your new
entertainment center is crowding out
a couch. Usually, with a little
rearranging, you can get things back
in order. And the same is true with
your portfolio: Over time, it might
have become unbalanced, with too
much of one investment and too
little of another. This situation
could prove hazardous to your
financial situation, especially if
the imbalance means you are taking
on too much risk or, conversely, if
your holdings have become too
conservative to provide the growth
you need. A well-balanced portfolio
can help you achieve your long-term
goals and accommodate your
individual risk tolerance, but it
will not assure you of a profit or
protect against a loss in declining
markets.
-
Update your home's look. If you've
lived in a place for a long time,
the rooms and even the landscaping
can start to look a little frumpy.
Perhaps the way you lived in 1997 is
not quite the way you live in 2007.
So, you make some changes. And when
you look at your investment
portfolio, you might also think that
some elements do reflect new
realities of your life such as
marriage, divorce, a new child, a
child going off to college or
impending retirement. If this is the
case, you may need to adjust your
holdings.
-
Check your security system. It's
always a good idea to check your
smoke detectors and alarm systems to
make sure they are functioning
properly. And, just like your home's
security features, your life
insurance needs to be checked
periodically. If you have moved to a
more expensive home, or if you have
added a child to your family, is
your insurance still sufficient? Or,
if you have recently remarried or
divorced, have you changed your
beneficiaries?
As you can see, you can gain
a lot of benefit from a financial spring
cleaning. Get started soon. |
