5 signs it may be time for a financial review
To keep your financial affairs in order, you need to review them anytime there’s a significant change in your life. Any of these developments should trigger a review.
1. Job changes
A new job with higher pay may mean you should review your insurance coverage for income replacement and the contributions you’re able to make to your investment portfolio. A decrease in pay, or losing your job, may require some short-term planning and budgeting.
2. Changes in marital status
When you get married, you’ll probably want to review your will, as well as your insurance policies, pension plan, and Registered Retirement Savings Plan (RRSP) or Registered Retirement Income Fund (RRIF). The same applies if your marriage ends because of separation, divorce, or death. Getting married also means there may be spousal tax-saving strategies you can now use.
3. Major life events
Having a child means new responsibilities and new expenses — definite signals that you need to review your whole financial set-up, especially your insurance needs. Other major life changes include buying a home, starting your own business, retiring, or becoming disabled.
4. Economic changes
If the economy is heading for a shift, for example, a recession, you need to be prepared. A review is in order, including your investment and retirement plans.
5. A shift in your investor profile
As you get older, you may need to take a more conservative approach to investing. It’s important to review your investment plan regularly to make sure it’s appropriate for the type of investor you are today, not the investor you were five years ago.