Meeting with your financial advisor can sometimes feel like a formality. You might even wonder if it’s worth your time. But having reviews can be a key checkup for your monetary health, ensuring you’re still on track to reach your life goals.
Think of it like going to the dentist for a cleaning. Sure, you might assume everything is fine. But if there’s a cavity forming, you’d rather catch it early. The same goes for money matters. Early detection of financial “cavities” can save you a lot of money and stress down the line.
Over the next several sections, we’ll dive into key questions you can bring to your next review. Each section is designed to spark insights, uncover opportunities, and highlight areas for improvement. By the end of this article, you’ll have a practical checklist to (hopefully) make your yearly reviews more productive and engaging.
Reassessing Goals and Overall Strategy
Life isn’t static, and neither are your financial priorities.
A lot can change in a year.
Maybe you’ve switched careers, lost a job, or found a new passion you’d love to pour some time and money into in the near future. Regardless, the first order of business is to make sure your goals and strategy are still connected.
Have My Financial Goals Changed?
It’s surprising how often people’s personal goals shift without them realizing it. You might have originally planned to retire at 65, but if a big inheritance, a career leap, or a desire to take a sabbatical has popped up, that target could change.
If you haven’t already, make sure to run any of the following by your advisor:
- A newborn or adoption
- A new mortgage or refinance
- A windfall from inheritance or bonus
- A shift in career trajectory (promotion, layoff, new business)
Is My Current Financial Plan Aligned With These Goals?
Once you’ve clarified any major changes over the past year and where you’re looking to go, it’s time to see if you’re still taking the right steps to get there.
Are you putting away enough money each month? Are you taking on the right amount of risk?
If your plan was built around old assumptions, it’s probably time for some tweaks. You might need to save a bit more aggressively, or you might decide to lower your risk because you’ve already accomplished certain goals.
Do We Need to Adjust Time Horizons for Major Milestones?
Ask about any big targets you have: paying for a child’s college, buying real estate, or pivoting careers. If you hoped to do it in five years but now want ten (or vice versa), your advisor can advise you on strategies to meet these targets.
That said, it doesn’t have to be “big picture”…
Minor changes matter, too. Maybe you decided to rent out a portion of your home, which could alter your timeline for paying off the mortgage. Or perhaps you want to accelerate a home renovation. The more details your advisor has, the more accurate your plan can become.
Portfolio Performance and Asset Allocation
Yes, you do want to know how your investments did…
But performance goes well beyond just a single number.
You’ll want to dissect performance, weigh it against appropriate metrics, and decide whether your allocations are still correct, given your current risk profile.
How Have My Investments Performed Over the Past Year?
It’s natural to focus on how much your portfolio went up or down. But ask for context. How did your returns compare to relevant benchmarks, such as the S&P 500, a bond index, or international indices?
Performance factors to discuss include:
- Long-term vs. short-term returns
- Impact of market volatility on your holdings
- How each asset class contributed to overall gains or losses
By looking at your performance in this multifaceted way, you’re less likely to make knee-jerk decisions based on a single year’s numbers.
Is My Asset Allocation Still Appropriate for My Risk Tolerance?
Your advisor likely worked with you to create a certain mix of stocks, bonds, and other investments when you first started working together. But maybe your feelings about risk have changed.
If you had trouble sleeping during a market dip, that’s a clue you may be taking on more risk than you can handle. Conversely, if you’re realizing you won’t meet your goals without higher returns, you might need to tilt the portfolio toward more growth-oriented investments.
Do We Need to Rebalance or Diversify in New Ways?
Sometimes, a portfolio drifts simply because some investments grow faster than others. A portfolio that was initially 60% equities and 40% bonds can turn into 70% equities after a bull run.
Rebalancing can pull you back to your target mix.
Your advisor might also suggest new diversification strategies. Perhaps your portfolio is heavily U.S.-centric, and it’s time to add more international exposure. Or maybe you have a big chunk of employer stock that’s become too large a piece of the pie. These reviews can highlight and correct any imbalances as well as make you aware of opportunities.
Retirement Readiness and Income Planning
For many, retirement is the flagship goal of financial planning. Whether you’re five years away or twenty-five, it’s important to check in and see how your progress matches your timeline.
Am I on Track for My Preferred Retirement Age?
Retirement planning projections are not set in stone. They can vary depending on market performance, your savings rate, and your desired lifestyle in retirement.
Here are the key retirement specifics to review:
- Expected monthly or annual expenses post-retirement
- Estimated Social Security or pension benefits
- Assumed rate of return on investments
- Future inflation assumptions
If the math shows you’re behind, you might need to increase contributions or adjust your intended retirement age. If you’re ahead, maybe you can retire sooner or opt to fund other goals.
How Much Income Will I Need and Which Accounts Will I Draw From First?
If you’re close to retirement, the “income phase” becomes more pressing. You’ll want to figure out how to tap your retirement accounts (e.g., 401(k), IRA, and Roth IRA) and taxable accounts in a tax-efficient manner.
Traditional wisdom suggests drawing from taxable accounts first, then tax-deferred, then Roth. However, individual circumstances vary, especially if you’re trying to manage income levels for tax bracket reasons or considering Roth conversions. An advisor can help you plan those withdrawals so you don’t face unpleasant surprises.
Have Any New Retirement Laws or Rules Come Into Play?
Retirement-related legislation can shift the age for required minimum distributions or change contribution limits. If something like the SECURE Act or other policy changes passed recently, ask how it affects your timeline or your required distributions.
Don’t assume your advisor will automatically incorporate every update.
By asking directly, you ensure the conversation addresses any newly enacted rules. Small changes, like a bump in catch-up contribution limits, can make a meaningful difference if you’re trying to accelerate your savings.
Tax Efficiency and Planning
Taxes can nibble away at your returns and income. A conversation about tax efficiency each year helps keep more money in your pocket and out of Uncle Sam’s. Even small changes to how you invest or withdraw can result in big savings over time.
Am I Using Tax-Advantaged Accounts to the Fullest?
Whether it’s a 401(k), Roth IRA, or Health Savings Account (HSA), find out if you’re maxing out what you can comfortably contribute. An HSA, for instance, can function like a stealth retirement account for healthcare costs if you invest the funds long-term.
Popular tax-advantaged options include:
- Traditional IRA: Contributions may be tax deductible, depending on your income and employer plan.
- Roth IRA: Pay taxes now for tax-free growth, subject to income limits.
- HSA: Triple tax benefit if used for qualified medical expenses.
- 529 College Savings: Earnings grow tax-free if used for education costs.
Keeping an eye on annual limit changes is also crucial. If the IRS raises contribution limits, see if you can increase your deferrals.
Should I Consider Tax-Loss Harvesting or Roth Conversions?
Tax-loss harvesting involves selling losing investments to offset capital gains. It’s popular in taxable brokerage accounts, but you’ll want to avoid running afoul of wash-sale rules. If some of your stocks or funds have taken a dip, harvesting losses might help lower your overall tax burden, especially if you’ve also had big winners.
Roth conversions can be another strategy. You pay taxes on the converted amount now, but then it grows tax-free in the Roth. A review is a great time to see if your income or tax bracket changed, making a partial or full Roth conversion more appealing.
Have Any Tax Laws Changed That Affect Me?
Laws around deductions, credits, and thresholds can shift. Maybe new legislation raises the standard deduction or modifies child tax credits. Or maybe you got married (or separated), and your filing status changed. Bring up these details so your advisor can tailor tax strategies specifically to your situation.
If your advisor doesn’t handle taxes in-house, they might coordinate with your CPA or tax professional. It’s also useful to ask if certain moves must happen by year-end, such as taking advantage of specific deductions or setting up a donor-advised fund for charitable giving.
Estate Planning and Legacy Goals
Whether you aim to leave a sizable inheritance or just want to direct your assets properly, it comes down to proper estate planning. The last thing you want is confusion or legal hassles for loved ones after you pass.
Estate planning may not need to be discussed with your advisor every year. Many advisors discuss it less frequently, for example, every 3 to 5 years or as necessary.
Is My Estate Plan Accurate and Up to Date?
An estate plan may include a will, durable powers of attorney, healthcare directives, and possibly a trust. Did you set everything up years ago and forget about it? It’s wise for you to review it at least once a year to catch changes in your finances or personal relationships. Your attorney will need to be contacted as another authority to advise on changes and help implement them.
Here are some documents to review:
- Your will (names of executors, guardians, heirs)
- Living trust details (if applicable)
- Powers of attorney for finances and healthcare
- Advanced healthcare directives or living will
Are My Beneficiary Designations Coordinated Across Accounts?
Your will might say one thing, but your insurance policy or IRA beneficiary form could say another. In most cases, beneficiary designations override the will if there’s a conflict. It’s easy to forget to update forms for bank accounts, 401(k)s, or life insurance. A review is the perfect time to ensure consistency.
Am I Taking Advantage of Estate Tax Strategies or Gifting Exclusions?
Federal estate tax exemptions are quite high, but they can change. Some states also have their own inheritance or estate taxes. If you’re above certain thresholds—or expect to be—consider making annual gifts.
Gifting money each year up to the allowed exclusion can gradually reduce the size of your estate, potentially lowering estate taxes later on. If you’re charitably inclined, talk about donor-advised funds or charitable trusts. These can let you give to causes you care about while also providing tax benefits.
Please Note: The Tax Cuts and Jobs Act (TCJA) is set to sunset at the start of 2026. This legislation has had major impacts on everything ranging from the standard deduction amount and your lifetime gift and estate tax exemption amount. However, this could change in the near future. Bring this legislation up to your advisor to see if it may apply to you.
Emergency Preparedness and Cash Flow
You never know when life will throw a curveball. That’s why having a solid emergency fund is so important. Even if you feel stable, a brief job loss or sudden medical expense can wipe out savings if you’re not prepared.
How Prepared Am I for Financial Emergencies?
It’s typically recommended three to six months’ worth of living expenses in accessible accounts. But you might aim for more if you have a high-paying, volatile job or a one-income household. Conversely, if you have stable finances and multiple income streams, you might lean toward a smaller emergency fund to keep more money invested.
It’s worth having a conversation with your advisor about the right amount for your situation. Moreover, get clarity on the best types of accounts (like high-yield savings, money market funds, or even short-term CDs) and the most efficient ways to access those funds should an unexpected need arise.
Charitable Giving and Philanthropic Plans
Giving back can be a huge part of your financial life. If you’re donating to causes you care about, you may want to explore ways to do so strategically. That way, both you and your preferred organizations get the most benefit.
Am I Incorporating My Charitable Goals Effectively?
If philanthropy is important to you, mention it early in your review. Your advisor can suggest structures like donor-advised funds, which let you bunch contributions in high-income years, or set up planned giving strategies. You could also consider gifting appreciated stock to avoid capital gains taxes while supporting your favorite charities.
How Can I Optimize My Donations for Tax Benefits?
Talk about the standard deduction vs. itemizing. If your donations and other deductible expenses don’t exceed the standard deduction, you might opt to bunch several years’ worth of donations into one year to maximize itemizing. The other years, you’d take the standard deduction.
Potential giving strategies to review:
- Donor-Advised Fund (DAF): Contribute appreciated assets, get an immediate tax deduction, and distribute to charities over time.
- Qualified Charitable Distributions (QCDs): If you’re 70½ or older, direct IRA withdrawals to charity tax-free (now subject to updated RMD ages, but QCD age often remains 70½).
- Charitable Remainder Trust: Receive income now and donate the remainder to charity upon death or after a set term.
Could My Philanthropy Tie Into My Estate Planning?
Some people choose to leave a certain percentage of their estate to a favorite nonprofit. This can be done via a beneficiary designation on retirement accounts or through a provision in a will.
If you’re passionate about specific causes, your advisor can show you how to incorporate charitable bequests without shortchanging heirs. Balancing personal legacy goals with philanthropic ones is a conversation worth having at least once a year.
Advisor Relationship, Fees, and Service Scope
A relationship with a financial advisor should be transparent. That means discussing fees, the type of services you receive, and how often you can expect updates. If you’re paying for a service, it’s fair to know exactly what it includes.
Can You Clarify Your Fee Structure?
Some advisors charge a percentage of assets under management (AUM), often around 1%. Others might charge a flat fee, hourly fee, or rely on commissions. You want to be sure you’re comfortable with how they’re compensated. This also helps you know if certain services might cost extra.
Run through the following questions to clarify what you’re paying and getting:
- Do you charge separately for financial planning?
- Are there any additional costs for estate or tax consulting?
- Is the advisor fee the only expense, or do underlying funds have expense ratios as well?
What Services Am I Not Currently Using That Might Benefit Me?
Financial advisors often offer a range of services: financial plans, estate planning, college savings advice, mortgage refinancing guidance, and plenty more. If you only talk about your portfolio returns, you might miss out on other valuable help.
How Often Should We Communicate and in What Format?
Some people prefer quarterly check-ins, others like monthly calls, and a few might only need a annual review. Ask your advisor what they recommend and what they usually provide. With evolving means of communication and people’s preferences for meeting frequency, it can vary. If you prefer phone calls over in-person meetings, let them know. If you like receiving market updates by email, ask if that’s an option.
Ensuring you’re on the same page communication-wise can prevent misaligned expectations. You don’t want to feel ignored, nor do you want to be bombarded with messages if you only need minimal contact. Find the sweet spot that suits you both.
Final Thoughts
Meeting with your financial advisor doesn’t have to be a mere check-the-box exercise—it can be a chance to shape your future, gauge your progress, and refine your plan as life evolves.
By asking the right questions, about everything from changing goals to asset allocation, you can spot opportunities and address potential pitfalls before they become problems.
If you’d like to discuss these questions with a financial advisor in the context of your personal situation—or simply want a deeper conversation about your financial roadmap—schedule an introductory call with our team today.
Sheena is a highly regarded financial professional known for her clear explanations and practical advice on complex financial matters. She earned her CERTIFIED FINANCIAL PLANNER™️ designation in 2010 and holds a Bachelor of Science degree in Finance from the University of Wisconsin LaCrosse.
