Portfolio Spring Cleaning

By: Michael Foster, CFA, CFP®

‍

It’s 89 degrees outside as I’m typing this. It might be the middle of May, but it sure is starting to feel like summer in Charlotte. Soon enough schools will be out, pools will be open, and “Wow, it’s hot outside!” will begin many conversations around grills. 

‍

Before the next few weeks are up, I’m going to ask you to do one more bit of spring cleaning. Instead of rummaging through your closet to see what’s out of style or doesn’t fit, it might be time to see if there are any items across your portfolio that could use a good tidying up. 

‍

We often work with clients to help them make these changes and make sure everything is working towards their goals. If doing things yourself, you may want to consider the items below that pertain to your situation. This isn’t an exhaustive list, but we often see many of these go unchecked when reviewing current accounts with potential clients before starting a relationship. 

‍

Happy cleaning!

‍

Review Your Goals

• Have your goals changed since you first invested your accounts? Have those changes been incorporated into your current investment strategy?

‍

Rebalance Your Portfolio 

• Check your asset allocation and rebalance if necessary to get back to your desired risk level. 
• Assets perform differently over time, and your portfolio may not look like it did when you last reviewed your investments and their percentages.

‍

Update Your Beneficiary Information

• Verify your wishes and beneficiary information is correct across accounts in the event of your passing.
• Did you have a child, get married, get divorced, or go through some other life change that might necessitate a change? 
• If you have a trust, are the accounts titled appropriately?

‍

Update Contact Information

• Did you move, get a new phone number, or email address? Do you prefer to get notifications via email or by mail?
• Consider adding a trusted contact or two to your accounts in the event the institution believes you’re being taken advantage of or are experiencing diminished mental capacity. 

‍

Review Your Contributions and Updated Limits

• Check and adjust if needed any automatic contributions to different accounts to make sure they’re aligned with your savings goals.
• If you want to max out your contributions to certain tax-advantaged accounts like a 401(k), IRA, or HSA, be sure you know what the limits are and adjust accordingly. 

‍

Plan for Your Required Minimum Distributions (RMDs)

• If you’re near age 73 (or whatever the appropriate age is for your RMD based on current regulation), plan on how and when you will begin taking your RMD. 
• Ensure you understand the rules, procedures, and relevant deadlines to avoid penalties.

‍

Tidying up your portfolio can help make sure your investments are aligned with your wishes, working towards your goals, and operating within the rules. We help our clients take care of these items and more as part of a standard relationship. Feel free to give us a call if you want to outsource any future cleaning!