How To Prepare Your 2022 Financial Review

How To Prepare Your 2022 Financial Review
Categorized as Sterling Tax Advisors, Wealth Management Tagged

We’re coming to the end of 2022, and it’s a time of reflection for many. If you’ve accumulated some wealth throughout the year and want to manage it to the best of its potential, a year-end financial review can help you meet your goals. Keep reading to learn how to do your 2022 financial planning review. 

How Often Should You Do a Complete Review of Your Finances?

The frequency you review your finances depends on where you are in your financial planning journey. If you’re starting and trying to figure out a reasonable budget, you should review the numbers more frequently, perhaps weekly. You should conduct a general review of your finances monthly, a complete review quarterly, and an in-depth review every year. 

How Do You Prepare for a Personal Financial Review?

Whether you are reviewing your number solo or with a professional, take the time to prepare a thorough personal financial review. Here are the components you’ll need:: 

  • Account balances. Make a note of your various account balances so you have them ready for your review. That includes balances from your checking, savings, and money market accounts. 
  • Investment accounts. Check your individual investments to see how they’re doing and the balances you have in each account. These accounts include any IRA, 401K, Roth IRA, or brokerage accounts.
  • Debt. No matter how much money you are saving or earning, your wealth is only as significant as the debts you owe. Gather all the information from your personal debt, including credit cards, student loans, mortgages, and others.  
  • Expenses and income. Review your expenses and income over the past year and prepare to have those numbers on hand. 

Items To Be Included in a Financial Review

Your annual financial review analysis touches every aspect of your wealth, income, and expenses. These are the factors to cover: 

  • Income statements
  • Average monthly expenses
  • Budget
  • Goal setting
  • Retirement savings plan
  • Debt payback 
  • Investment strategies
  • Options for increasing income

What you include in your annual financial review depends on your preferences, but the above factors are essential. 

What is the 50/30/20 Wealth Rule?

The 50/30/20 wealth rule is a financial management tool that can help you stay on budget and meet your financial goals. The idea is simple: you break your after-tax income into three categories – 50% on needs (housing, food, bills, and others), 30% on wants, and 20% toward savings. 

While this tool is a helpful rule of thumb, the aim is to meet your goals as best you can. The ultimate goal is to evaluate and manage your money for your financial growth.

Review Your Finances With an Expert

A professional financial advisor can provide the expertise you’re looking for in a year-end review of your finances. They can help you understand wealth management, establish goals, and work toward financial stability for the years ahead. 

At William Rogers Company, we work with individuals to help maximize your income and wealth potential. Schedule a call to set up a year-end financial planning review at 888-297-3321.