The first step in building a plan to reach a financial goal is understanding where you are today. Answer these questions to gauge how well you know your current financial situation.
|1. I know how much I/we spend each month.||Think about your mortgage, utilities, food, clothing, education, insurance and entertainment.|
|2. I know the location and amounts of all my/our investments.||Think about cash, CDs, stocks, bonds, mutual funds and real estate.|
|3. I/We have saved six months’ worth of living expenses.||Think about the gross amount spent for essentials and miscellaneous on a six-month basis.|
|4. I know the rate of return each year for each of my/our investments.||Include the rate of return for CDs, stocks, bonds, mutual funds, real estate and other investments.|
|5. I know how much I am/we are saving for retirement.||Note if this is a regular monthly amount and/or if you use systematic investing.|
|6. I know the value and location of all my/our retirement accounts.||Think about employer-sponsored plans, IRAs and annuities.|
|7. I know how much I am/we are estimated to get from Social Security.|
|8. I know how much insurance coverage I/we have.||Think about life, disability and long-term care coverage.|
The more statements you marked true, the better you know your current financial situation.
For any statements you marked false, make a commitment to learning the answers. Armed with this information, you can work with your financial advisor to build a better strategy for getting where you want to go.