When reviewing your personal financial plan today, the following are some of the questions you should be asking.
Is my current retirement plan still realistic?
What effect with the new normal have on my projected living expenses?
If you have a pension that is guaranteed. What will guarantee it going forward? If it is decreased, how does that affect my financial future?
The US just implemented a two trillion dollar stimulus package and considering additional multi-trillion-dollar stimulus plans. What affect will this have on inflation rates and if inflation rates increase, how will that affect you?
Conversely, deflation is a risk at this time. How would deflation affect you?
What is a reasonable projected rate of return to expect on my investment assets going forward?
Is the current asset allocation of my portfolio reasonable going forward? What is the projected expected returns and volatility/risk assumption?
Is it possible to have delation followed by inflation?
The US had the highest per capital cost of health care in the world prior to the pandemic. How will the potential for increased costs of health care affect me?
How much margin of error is there in my financial plan?
Is my current rate of withdrawal from my retirement assets realistic going forward?
What expenses are likely to increase. Are there expenses I can reduce?
What is the best investment allocation for me going forward?
What are risks going forward, are they insurable and should I insure them.
What are the internal fees for my investment assets and can they be reduced?
For example, if using a money manager, are the annual fees reasonable and competitive.
- Another example, many pre-retirees, and current retirees own variable annuities with 1-2% internal administrative fees which on $250,000 can range from $2,500 to $5,000 annually.
- By comparison, one insurance company's fee-only tax-deferred annuity company has an administrative fee of $20 per month or $240 annually.
- Some life insurance and index annuity products have very high internal sales charges. How can I avoid this?
Tax laws may change in the future. How do I plan for that?
Many of the above questions are always important to ask, but with the new normal, are especially important to evaluate and discuss going forward.