December is here! As 2022 draws to a close and we go hurtling towards the holiday season and the new start of a brand-new year, we encourage all our clients to spend a little bit of time on a financial review to make sure your affairs are in order. Here is a handy list of tasks you should carry out to make sure you are set up for financial success in 2023 and beyond.
A lot can happen over the course of a year. Perhaps you got a new job in 2022? Had a baby? Got married? Maybe you moved to a new country?
Less happily, you may have lost a loved one or got divorced. All these major events will require a financial planning reset with certain tasks to carry out to ensure that your affairs are set up correctly.
We’ve created this handy checklist that you can work through to make sure that your finances are in tip-top condition to start 2023 in the best possible shape.
Update your budget and review your spending
Spending habits change and perhaps this year more than usual with inflation rising and a cost-of-living crisis in full swing. Reassess your outgoings and set your monthly budget for 2023, ensuring that you are spending within your means. Understanding exactly where your money is going can help you pinpoint where savings can be made, if required.
Check outstanding debt and repayment progress
Paying off unsecured debts should be your financial planning priority. If you have debts on credit cards, store cards etc, make an inventory so you know exactly what you are dealing with. Then, look at how you can pay them down in 2023.
Could you consolidate to make savings that enable you to accelerate repayment? Could an end-of-year bonus be in part dedicated to debt repayment? Can you allocate more of your monthly budget in 2023 to paying down debt?
For more information about getting – and staying – debt-free, take a look at this blog post.
Review savings progress
Saving is essential to ensure your future financial security. Are you doing enough? It’s time for another inventory! This time of your assets. Have you made progress in 2022? It could be a good time to ask your financial adviser about cashflow modelling to ensure that your financial plan is fit for purpose over the long term.
Review savings goals
Setting savings goals is extremely important. If you don’t know what you are aiming for, how can you possibly achieve it? Allocate a specific (realistic!) amount to save each month in 2023.
Don’t forget the wise words of financial genius, Warren Buffet: ‘Do not save what is left after spending, but spend what is left after saving.’ If you want to achieve financial success over the long term you MUST prioritise saving.
Review asset allocation
At Infinity, we aren’t advocates of trying to time the markets but that doesn’t mean your portfolio should stay the same forever. Financial markets have certainly proved volatile in 2022, which may mean your investment portfolio needs a rebalance. Why not have a chat with your financial adviser as the year comes to an end to see whether you need to make any changes?
Check you have sufficient life insurance
Our advisers find many of our clients are underinsured. The end of the year is a good time to verify that your family is adequately protected with sufficient life insurance to cover all their needs in the event of your death. Adon Beddoes, one of our chartered financial planners in Vietnam, provides some tips on checking life insurance coverage on our blog here.
Are life insurance beneficiaries up to date?
Statutory removal of a spouse when a divorce occurs is not a given on a life insurance policy and this can be a huge source of stress if overlooked. Ensure new partners don’t miss out on a life insurance payment by ensuring beneficiary designations are up to date.
Are any changes needed to your will?
If you lost a loved one, got married or welcomed someone new into your life in 2022, you may want to add them as a beneficiary of your will. While you’re at it, make sure the named executor is still relevant.
Check subscriptions
Do you have a gym membership but never go? Perhaps you signed up to Audible with good intentions to broaden your mind but have never listened to a book. Do you pay for both Netflix and Prime? Spotify and Amazon Music? Most of us have a subscription or two surplus to requirements so now is a good time to cull the ones you are paying for unnecessarily.
Review insurance policies
It’s worth doing an annual check of your home and motor insurance policies to ensure that they still meet your needs. If you have made major purchases over the year your coverage may need to be extended.
It never hurts to shop around to be sure that you are still getting the best deal, particularly if your premiums have gone up. You may find you can get the same coverage for less by changing providers.
Review utility provision
With energy prices skyrocketing, it’s a good idea to check whether your current utility providers are providing value for money. Prices do vary and some companies may offer deals for you to switch.
Your financial adviser would be happy to help if you need any assistance with any of these end of year tasks. Don’t hesitate to contact them with any queries.
If you don’t have a financial adviser, it might be time to add finding one to your checklist! Our advisers are based throughout Asia and are highly experienced in helping expatriates and locals plan for a secure financial future. Contact us for a free exploratory call to find an adviser who is the right fit for you.
A leading provider of expat financial services and wealth management services across Asia.
