As a military family, it's crucial to be on a solid financial footing. The beginning of a new year is an excellent time to evaluate your financial situation, set new goals, and make necessary adjustments to your financial plan. The military financial professionals with AAFMAA Wealth Management & Trust LLC (AWM&T) can guide you through key considerations that will help your military family navigate your finances in the coming year. Explore this questionnaire to map out your finances. Then reach out to us for customized wealth solutions to help you achieve your goals.
Assessing Your Progress
The first step in your financial planning journey should involve assessing the progress you made toward your goals last year. To do this effectively:
- Review and compare your financial models, comparing where you are today to where you were at this time last year.
- Inventory your recent accomplishments to identify which strategies worked well.
- Identify new financial goals for this year or the future and incorporate them into your overall plan.
- Consider any significant life events that may occur this year, such as a move, marriage, birth, higher education, job change, or retirement.
- Confirm whether you or any family members will reach a milestone age this year.
- Address any concerns or variables that could potentially impact your plans for the year.
Managing Income and Expenses
Financial stability comes from managing your cash flow. Consider the following:
- Evaluate whether your household income and expenses will change significantly this year.
- Review your cash flow plan by assessing your actual income and expenses and adjust your spending plan as necessary.
- Ensure you take full advantage of your employee benefits, including retirement accounts, Health Savings Accounts, Flexible Spending Accounts, and Dependent Care Flexible Spending Accounts.
- Explore IRA contributions, including funding a Roth IRA, making deductible contributions to a traditional IRA, or making after-tax contributions depending on eligibility. Consider spousal IRA options if applicable.
- Review your target savings and funding rates to ensure you are adequately saving toward your goals.
- If you have funds left in your FSA from last year, consider spending them before the grace period expires.
- If you are subject to taking Required Minimum Distributions (RMDs), plan strategically to meet your goals while satisfying your RMD requirements. Consider options like Qualified Charitable Distributions (QCDs) if you're charitably inclined.
- Strategically fund annual gifts and track the use of your annual exclusion amount for non-charitable gifts.
Securing Your Financial Future
Your assets and debts play a significant role in your financial stability. Take the following steps:
- Ensure your emergency fund is adjusted and adequately funded.
- If you plan to buy or sell any business, personal, or real property this year, plan accordingly and consider the financial implications.
- Review your investment risk tolerance to ensure it aligns with your financial goals and timeline.
- Assess the performance of your investment accounts and make necessary adjustments.
- Consider rebalancing your investment portfolio or adjusting your asset allocation as needed, taking tax consequences into account.
- Revisit any short-term trading strategies implemented last year for tax purposes and adjust your strategy accordingly.
Your Financial Compass: AAFMAA Wealth Management & Trust
Navigating the complex world of military finances can be challenging, but with careful planning and consideration, you can set yourself up for a successful financial year. For seasoned guidance and support, rely on us for valuable financial advice tailored to your military family. Start the year with confidence and a solid financial plan in place to achieve your goals and secure your family's financial future. Speak to an AWM&T Relationship Manager or call 910-307-3500 today.