Annual and Semi-Annual Financial Reviews aren’t reserved just for the top-earning financial planning clients. Just because you’re not a millionaire yet, doesn’t mean you can’t give yourself this financial luxury. This is why my husband and I make it a point to sit down and do a deep dive into our finances every 6 months. This isn’t to say that we’re not budgeting, saving, and investing on a monthly basis. Making time to review the parts of our finances that we don’t keep up with on a monthly basis is highly important. We treat our semi-annual financial reviews like deep money cleanse to make sure we’re on track with our goals and make any adjustments necessary.
It doesn’t matter if you are married, single, a millionaire, a thousandaire, or none of the above. We all need to make the space in our calendars to do a deep dive into our finances. All through doing semi-annual financial reviews every 6 months is ideal, you can do quarterly financial reviews to keep your finances in tip-top shape. These reviews do not replace your monthly budgeting, saving, and investment reviews that you should be doing routinely.
Marriage and Money Reviews
When you have a partner, you have to make sure you’re both clear on what’s going on with your finances, not just one of you. As a mom and a wife, I know how difficult this can be when we’re juggling so many roles at the exact same time. But knowing about your taxes, investments, and budget isn’t just a man’s role. I believe it’s a team role that everyone needs to know and be kept up to speed on. Having these deep dive semi-annual financial reviews gives all partners the ability to ask questions, research, and get involved with the family’s finances. Take these opportunities to openly communicate about your family’s goals, values, and feelings about your financial journey.
Budget: Are you on track with your projected budget?
Are you on track with your budget? Wow, this is a financial icebreaker when you first start digging into the numbers part of your finances. Six months into the year can give you a good perspective about your initial budgeting goals for the year. One of the biggest areas you want to break down and make monthly comparisons on are the costs of your bills, food, debt, and lifestyle spending.
Here are a few questions to ask yourself for each of these budgeting categories:
Q: Are your bills consistently trending around the same amounts each month or did you have some large jumps? If so, why did your bills jump in price so much?
Q: How much are your groceries costing you on average? Do you see an improvement in grocery waste, are you eating the meal prep, are you eating healthier?
Q: How much debt have you paid off within the last 6 months? Are your habits keeping you on track to helping you pay off your debt?
Q: Which areas of your finances have you overspent on consistently and by how much on average?
Investments: Are you maximizing your investment opportunities?
Let’s be honest, investment reviews are probably the first thing that comes to mind when you hear semi-annual financial reviews. Yes, you’re right. Going over your investments is a big part of what is talked about when working with a certified financial planner. The top investment accounts I add to my review are my husband and I’s retirement accounts, my kid’s 529 college savings plan, and our brokerage account. If you have non-portfolio assets like rental properties or businesses this is a great time to review their status as well.
Some of the top questions you want to go over during your own investment review are:
Q: How are your retirement investments doing compared to the S&P 500, or the Dow Jones Index? Are you happy with your current investment mix, do you need to switch to a more aggressive or less aggressive investment mix?
Q: Are the investment fees below 1%?
Q: How are your retirement funds doing compared to a retirement calculator?
Here are some of my favorite retirement calculators:
- Vanguard Retirement Income Calculator
- Fidelity Retirement Score Tool
- Bankrate Retirement Plan Calculator
Update Personal Information
You also want to take the time during your semi-annual financial review to update any personal information or changes to your investment accounts. You can update your address, add new beneficiaries, update your email, and any auto-investments like if your dividends are re-invested. These small updates can error out and be undone by accident. I always spend an extra few minutes to make sure everything is left just right. Since I’ve personally experienced errors in my personal information before that undid the automatic reinvestment of my dividends.
Goals: Are you on track with your goals?
Setting goals is fun, but once you’re actually doing the work to accomplish the goal you may need to make some modifications. Sometimes you realize that your time frame is too tight or that your goal isn’t realistic due to your personal and family situation. This is something that I’ve dealt with at many of my own semi-annual financial reviews. Going over your budget and having conversations about how you feel about your goals really solidifies if you’re happy with your goals or if you want to change them. It’s 100% okay to change your goals or to make modifications to the time frame to alleviate your stress.
Here are some of the top goals you want to review and some questions you want to ask yourself:
Q: Your emergency fund, is it enough? Have you re-calculated how your emergency fund and how many months do you have?
Q: What are your short-term goals and can we save for them automatically?
Q: What are your long-term goals? Are your long-term goals realistic to accomplish right now and do you still feel the same about reaching this goal?
Banking: Are your banks working for you or against you?
Banking is a topic that a lot of family’s miss when doing their semi-annual financial review. Being aware of your current banks and if the banking system is benefiting you and your family’s goals is very important. You can start by looking at your bank’s fees and if you’re getting hit with any. I know usually the bank fees tend to be small, so we skip past them without even noticing them. But this is the time to double-check.
Reviewing how you flow your money through your bank accounts is key to improving your finances. I personally created, use my High-5 Banking Method, which is a simple way to organize your finances with purpose. Making sure that I am maximizing how I use each bank account and simplifying my money system helps me stay on track with my finances on a monthly basis.
A few of the questions that you can ask yourself in this part of your semi-annual financial review are:
Q: How many bank accounts do you need? Is the High-5 Banking Method something you can implement?
Q: Can you automate any of your savings goals or is transferring the money best right now?
Q: How’s your savings account helping you save for your goals? Do you have a high-yield savings account?
- The High-5 Banking Method
- Saver vs Spender: How to Get Better with Money as a Couple
- Everything You Need to Know About 401(k)s