The new year is finally here, meaning it is time to review your wealth management goals for 2025. Reviewing your portfolio with a professional will help identify any potential risks, while focusing on opportunities for financial growth. Here are three key resolutions to plan for when considering the year ahead.
1. Optimize Your Investment Portfolio
The first wealth management resolution for 2025 should be evaluating your investments. A well-structured portfolio should align with your financial goals while taking into account your overall time horizon and risk tolerance. Be mindful of how market conditions and personal priorities evolve over time.
Key points:
– Review Your Asset Allocation: Confirm that your distribution across stocks, bonds, and cash are all in sync with your objectives. If the 2024 market shifts have altered your allocation, consider rebalancing to maintain alignment with your long-term strategy.
– Enhance Tax Efficiency: Explore tax-advantaged accounts and, where applicable, utilize tax-loss harvesting strategies to offset capital gains.
2. Increase Savings Contributions
Ensure you are enhancing your savings for overall asset and wealth management to prepare for 2025. This is a vital resolution that could involve boosting your contributions across various funds — from emergency reserves to retirement plans. Regular and incremental contributions can have a profound effect on your long-term financial security.
Key points:
– Maximize Retirement Accounts: For 2025, the 401(k) contribution limit has increased to $23,500 for individuals under 50, with an additional catch-up contribution of $7,500 available for those aged 50 and older. Contributing to these limits can significantly enhance your retirement savings.
– Automate Your Savings: Set up automatic transfers to your retirement, investment, and emergency savings accounts. Aim to gradually increase your contribution rate, even if it’s just by 1% each year.
3. Plan for Retirement with Updated Projections
It is common for retirement planning to take a backseat to other financial matters. However, conducting an annual review of your retirement strategy is crucial to ensure you remain on course to meet your aspirations, backed by current projections.
Key points:
– Estimate Your Retirement Needs: Utilize updated projections to assess the annual income required during retirement. Factor in inflation, healthcare expenses, and possible market variations.
– Evaluate Expected Retirement Income: Review your anticipated Social Security benefits, pensions, and retirement accounts. If you notice any gaps, perhaps consider increasing contributions or even modify your retirement age.
It’s that time again — tax season is already here! Don’t put off re-evaluating and ensuring your financial future is aligned with your goals. Schedule a meeting with an advisor at 360 Wealth Consulting today!
