Getting Your “Financial House” in Order


By Flip Ruben, Certified Financial Planner (CFP®)

For most people, buying a home may be the single biggest purchase of their lifetime. As you evaluate your housing needs, wants and wishes, it’s also the perfect time to evaluate your financial plans and get your “financial house” in order. As we approach the New Year, here are four year-end planning suggestions (if you aren’t already doing them!)

Speak to your accountant or financial advisor about tax savings.
Don’t wait until after the New Year. It may seem obvious, but many people do not proactively seek advice in the current tax year. Even if you do not itemize deductions, there may be opportunities to reduce your current year’s tax bill. Make the call today and review your situation.

Start budgeting in the New Year.
Do your lifestyle expenses align with your savings and long-term planning goals? Are your spending patterns consistent with your values and priorities? Budgeting can be a critical part of your financial well-being. Make an accountability pledge to yourself and begin budgeting. There are numerous excellent options, so pick one and stick with it for the New Year.

Re-evaluate your portfolio risk.
Did you know that over 90% of investment portfolio return variability can be attributed to asset allocation? (Brinson, Singer and Beebower Financial Analysts Journal 1991) Have you recently reviewed your mix of assets (stocks, bonds, cash, real estate, etc.) to make sure it is consistent with your risk tolerance and long-term planning goals and objectives? Keep expenses low and commit to investing at regular intervals to spread out timing risk.

Make a Plan
A useful financial plan provides a framework for making intelligent financial decisions based on your deeply held personal values, goals, and priorities. Because life can be complicated and unpredictable, a good plan also builds in flexibility and safety nets. If you don’t have a plan, consider whether it makes sense to have one.

Once your finances are in place, you can begin the exciting process of house hunting. Good luck!

Flip Ruben has been a Certified Financial Planner (CFP®) since 2002 and is Managing Director, Financial Planning, with Wellesley Investment Partners in Wellesley, MA. Flip’s focus is on midlife financial planning, and he resides in Newton, Massachusetts.

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