Life doesn’t always go according to plan. When it comes to protecting your assets, preserving your legacy, and navigating today’s financial landscape, “set it and forget it” is no longer enough.
At Premier Southwest Planning Group, we understand that life can change in ways you expect and in ways you don’t. We believe your financial plan should be able to change with you as major life events can affect your priorities, finances, and goals. Here are some of the most common life changes that may require you to revisit your financial plan, especially if you haven’t already planned for them.
Employment & Career Transition
Starting a new job, losing a job, or changing careers can have a significant impact on your financial picture. For instance, a job change can affect your employer-sponsored coverage, income, health insurance, retirement benefits, and other parts of your financial plan. If a change in your employment affects your finances, goals, or priorities, it may be a good time to revisit your financial plan by sitting down with a professional.
It’s important to remember that a major life event doesn’t have to meet a definition used by a health insurance provider. If a change in your employment affects your finances, goals, or priorities, it may be a good time to revisit your financial plan.
Marriage, Remarriage, Or Divorce
Marriage, remarriage, or divorce can all bring significant changes to your financial life, from your insurance and taxes to your income, assets, and long-term goals. Divorce, for example, may mean separating finances, updating beneficiaries, reviewing life insurance coverage, and determining how assets and retirement accounts will be handled.
Marriage may also affect your financial plan even if you’re not the one getting married. If you have an adult child who is engaged or in the process of wedding planning and you’re helping cover the costs, that financial commitment may be worth considering as part of your own plan.
Having Children And Grandchildren
Adding a new family member can have a significant impact on your financial life. If you have children, you’ll likely take on new expenses and responsibilities, from housing, food, and clothing to healthcare, education, and everything in between. It’s also a good time to consider whether your savings, insurance coverage, and overall financial plan reflect your growing family.
And once again, a major life event doesn’t have to happen directly to you. If your adult child has a child of their own, becoming a grandparent can bring new opportunities to support the next generation. If building multigenerational wealth and leaving a lasting legacy are important to you, you may want to help with future education costs, provide financial support, or even consider life insurance as part of your plans for your grandchildren.
Starting A Business
Starting, buying, or running a business can be an exciting opportunity, but it also comes with financial responsibilities and risks. You may take on business loans, lines of credit, or other financial obligations as you build and grow the business.
Your business may also depend on other people. If you have business partners or employees it’s important to make sure they’re protected as well, so your business will continue to run smoothly should something happen to them.
Home Ownership
Buying a home is a significant financial decision, and it’s sometimes called the “gateway” to other life milestones because it often coincides with other major life events, such as marriage, starting a family, career shifts like a new job, or even retirement. For many, it’s also the first major step toward financial independence.
Homeownership typically involves a large upfront cost, including a down payment, closing costs, and moving expenses, along with recurring costs such as mortgage payments, property taxes, insurance, and maintenance that can continue for decades. These expenses can significantly change your cash flow and budget, making it another important reason to revisit your financial plan and consider how this new commitment fits into your broader goals.
Paying For Higher Education And Training
Whether you’re financially preparing yourself or your children to pursue higher education or career training, investing in education can be an important investment in the future. From college and graduate programs to trade schools and professional training, these costs can have a significant impact on your financial plan. Planning ahead can help you consider how education expenses fit alongside your other financial goals and priorities.
For example, a 529 plan is a tax-advantaged education savings account designed to help families save for qualified education expenses. Contributions can grow tax-deferred, and withdrawals used for qualified expenses are generally tax-free at the federal level. Starting early can give your savings more time to grow and allow you to make education funding part of your broader financial plan.
Caring For Aging Parents
As we age, so do our parents and other important family members in our lives. While we may hope that day is a long way off, it’s not uncommon for adult children to eventually provide financial support for their aging parents, whether that means helping with care, healthcare expenses, housing, or other needs.
Taking on these responsibilities can affect your own finances and long-term goals. If you find yourself helping an aging parent, it may be a good time to revisit your financial plan and consider how this new responsibility fits into your broader financial picture.
Retirement
Of course, one of the most well-known major life events is transitioning out of the workforce and into retirement. While everyone hopes to retire comfortably with enough savings and investments to support the lifestyle they’ve worked toward, accumulating wealth is only part of the equation. A retirement that lasts several decades can bring its own set of financial challenges, including market downturns, inflation, taxes, healthcare costs, and the potential need for long-term care. Social Security can be an important source of retirement income, but it was designed to supplement other income sources rather than replace your working income entirely.
The bottom line is that the sooner you begin planning for retirement, the more time you may have to prepare for these challenges and make adjustments along the way.
Life changes. Your financial plan may need to change, too. Contact Premier Southwest Planning Group today at (480) 621-3646 to review your financial plan. We are your financial advisors in Scottsdale AZ.
This content is for informational and educational purposes only and should not be construed as tax, legal, or individualized financial advice. Always consult with your tax advisor, attorney, and/or qualified financial professional regarding your specific situation before making any retirement plan or tax-related decisions.
Sources:
https://www.newyorklife.com/articles/events-that-can-affect-your-life-insurance
