The Importance of Reviewing your Financial Plans annually

Your money or your life. Actually that’s true. If you don’t look after your money – value it, respect it, and find the best homes for it, you are not going to have a secure and comfortable life. Know your money, know yourself, and know how to manage the relationship. And this means your money’s wellbeing will be a huge factor in your life; it means that you will have to remain continually aware, and every year check in with the experts. Because things change and if you take your eye off the ball, you may regret it.

Financial planning is not a one-and-done activity but an ongoing process that evolves with your life. Therefore an essential component of effective financial management is making sure you review your financial plans annually. This practice can provide numerous benefits and help you stay on track towards your financial goals.

Setting and re-evaluating goals

  • It might seem a lot when you begin, but as you progress, it becomes second nature, a habit, and something you can look upon with enjoyment as you see your funds grow. When you create a financial plan, you establish specific goals, such as saving for retirement, buying a home, or funding your children’s education.
  • As things tend to change, an annual review allows you to revisit these goals, ensuring they are still relevant and aligned with your current circumstances and aspirations. Measuring progress, tracking savings and investments, debt reduction, monitoring spending, etc, provides valuable insights as to whether you are on the right road. Be ready to change direction according to circumstances.
  • Keep refining your budget by analysing expenses and identifying areas where you may be overspending, and make necessary adjustments to ensure you’re living within your means. In addition, you may find you can allocate your resources more efficiently and direct more funds towards savings, investments, or debt reduction.

Reviewing your Investment portfolio

  • A key aspect of financial planning involves determining the appropriate allocation of your assets among various investment types, such as stocks, bonds, and real estate. It’s important to ensure that your asset allocation remains in line with your risk tolerance and long-term goals.
  • By reviewing annually you can identify underperforming assets and consider whether adjustments or rebalancing needs to take place to continue optimising your returns. In this way, you can keep track of investment fees and taxes, capital gains and losses, as well as identifying opportunities to minimise expenses and enhance your overall investment strategy.

Preparing for emergencies – a vital aspect

  • Part of your financial plan should include an emergency fund to cover unexpected expenses or financial setbacks. An annual review is the time when you can assess whether your emergency fund is adequately funded and easily accessible in times of need.
  • Insurance plays a big part of your emergency strategy. It’s wise to remember that your insurance needs may change over time due to factors like a growing family, income fluctuations, or health issues. An annual review allows you to assess whether your insurance coverage, including health, life, and property insurance, is sufficient to protect your financial well-being as time, circumstances and inflation work to change conditions.

Rebalancing and risk management

  • Over time, changes in asset values can lead to an imbalance in your investment portfolio. An annual review provides an opportunity to rebalance your portfolio, bringing it back in line with your target asset allocation.
  • In addition, your tolerance for risk may change along with changes in your situation. Your financial plan can only keep in line with this if you take the opportunity to check annually. Regular reviews enable you to keep assessing and adjusting your investment strategy to align with your comfort level.


Key note:

Financial planning is not static; it’s a dynamic process that requires ongoing attention and adjustment. By embracing annual financial plan reviews, you empower yourself to make informed decisions, adapt to life’s changes, and work toward achieving your financial aspirations. Ultimately, this proactive approach contributes to your financial well-being and most importantly, your peace of mind, helping you navigate the complexities of your financial journey with confidence.

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The Importance of Reviewing your Financial Plans annually