Something about the freshness of spring flowers and the breeze through open windows speckled in sunshine encourages us to clean. When we get a taste of spring we immediately want to organize, declutter, and brush off the dust and dreariness that winter has left behind. Think about the feeling you have after a good thorough spring cleaning…somehow we feel lighter, our house feels airy, and a new level of happiness enters your psyche. The same can be true of decluttering other areas of your life, like your investments.
So many of your reading this have left jobs, and with it, left behind a retirement account or perhaps changed jobs multiple times due to a move, opportunity, or both. The mailbox is weighed down each quarter with multiple statements that often sit unopened and eventually shredded. The following 3 steps can help you clean up your “financial house” and with it bring you the same euphoric feeling and you may experience long lasting positive effects from doing so.
Consolidating all of your abandoned accounts into 1 account will allow you to go from multiple statements to 1 single statement; your mailbox will thank you and so too may your bank account. You have the potential to save costs by combining accounts and combing your investment allocation. Simplifying will allow you to keep better track of your investments and understand what you own. You’ll be more likely to update your beneficiaries on a single account. Another benefit is that the more money you have in one place, the more likely you’ll pay attention to it.
2. Establish a Strategy
It is difficult to establish and maintain a strategy when your investments are dispersed across a number of accounts. Managing your assets in 1 single account allows you to control the mix of stocks and bonds to ensure your account risk is aligned with your personal goals and objectives. Whether the strategy is to retire at 50 or fund your child’s education, you must have an investment allocation aligned with your strategy if you have hopes of meeting these goals. The most important part of a strategy is not the initial set up, but the ability to review and monitor on a regular basis, which is much easier to do in 1 account.
Orphaned accounts at previous employers are subject to the limitations of the employer’s plan; these limitations are unnecessary to adhere to when you are no longer employed by the firm. Rolling a 401(k), or other retirement account, into an IRA will open up investment options and solutions to you that were previously unavailable and allow you to work with an investment professional to help guide and direct you along your path to financial freedom.
Contact Charleston Investment Advisors for help cleaning your Financial House.
Stephanie Mackara is a Wealth Advisor at Charleston Investment Advisors. Charleston Investment Advisors is part of The Wealth Management Alliance LLC, a registered investment adviser. Though the contents of this article should not be construed as investment advice, feel free to reach out to Stephanie Mackara directly at firstname.lastname@example.org directly to discuss your specific financial situation. IRN TW 18-007