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Published on: 01/04/2023

What to Talk About During Your Annual Financial Review

Are you preparing for your annual financial review and wondering what questions you should be asking your advisor? Your annual review is an important meeting where you’ll discuss your finances, assess your financial goals, and make any necessary changes to ensure that you’re on track to meet those goals.

During your personal financial review, you’ll want to ask your advisor about the performance of your portfolio over the last year as well as dive into how your current wealth management plan aligns with how your goals or circumstances have changed.

In this article, Avidian Wealth Solutions, a high-net-worth investment firm in Houston, is here to help you prepare for your annual review. We’ll cover the key topics you should discuss with your advisor, the questions to ask about each topic, and any additional steps you can take to make sure your finances are in order for the year ahead.

What is a financial review?

Your annual financial review is a yearly meeting between you and your financial advisor designed to help you assess the performance of your managed accounts and finances over the previous year, discuss any changes that might need to be made in order for you to stay on track with your goals, and plan for any upcoming life events or milestones.

Throughout the meeting, you’ll have an in-depth conversation about your current financial situation and the best strategies for achieving your long-term goals. Your advisor will provide their professional opinion on any questions or topics that come up, allowing you to make informed decisions about how to manage your money, and making it a great opportunity to ask some important questions. 

How to prepare for your personal financial review

To prepare for your meeting, you should have a thorough understanding of your current financial situation. Spend some time compiling a detailed summary of all of your income sources, annual bank statements, and any other relevant sources so that both parties can accurately understand the state of your finances.

You should also come to the meeting with a list of specific questions to ask your financial advisor during your annual review. To make sure your annual financial review is as productive and successful as possible, here are some important topics you should consider discussing: 

What should I ask in a financial review?

1. How did my portfolio perform over the last year?

One of the most important topics to discuss during your annual financial review is how your portfolio has performed over the last year. By assessing the state of your investments, you can get a better understanding of whether or not they are performing well and if any changes need to be made. 

Your advisor will be able to provide insight into what strategies have worked well and which may need adjustment in order for you to reach your desired outcome. This information can then help inform decisions about where and how you should invest going forward.

In addition to assessing the performance of your investments over the last year, you should also discuss asset allocation with your advisor. Asset allocation is a process that helps you decide how much of your portfolio should be allocated to each type of investment in order to maximize returns while keeping risk levels low.

2. What changes should I make to ensure that I am on track for success?

There are likely key changes to your portfolio that you and your advisor can discuss to make sure you’re on track to meet your goals. It is important to discuss the effectiveness of your current strategy with your advisor and identify areas where you could improve performance or increase returns. 

Your advisor will be able to provide insight into any new strategies that would be tailored to fit your specific financial situation and goals. 

Ask questions about annualized and total returns from the previous year as well as any changes made in order to take advantage of market opportunities. By making these changes during your annual review, you can ensure that you are staying on track for success.

3. Are there any risks or opportunities that I should be aware of in the next year?

Your advisor will assess your portfolio’s current risk profile and provide feedback on whether any changes need to be made to confirm that you are adequately protected from any potential market fluctuations. Your advisor can also provide you with insights on upcoming opportunities for investment or strategies that could help maximize your returns.

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4. Is there anything that I can do to reduce my overall costs?

Taxes can have a huge impact on your overall financial picture, so make sure to ask any questions you may have about potential deductions, credits, or other strategies that could help reduce your overall tax burden. 

Consider whether any of your current investments might be underperforming and explore alternatives that may provide better returns at a lower cost. If you have multiple accounts or assets spread across different providers, consolidating them in one place can help simplify administration and potentially save money on annual account fees.

Because there is no income tax in Texas, you may want to discuss strategies for reducing your federal taxes. Your advisor can provide insight into the best ways to maximize your annual deductions or credits so that you don’t have to pay more than necessary. 

5. Do I need to make any changes to my retirement plans or investment strategies?

If you are nearing retirement, your annual financial review can serve as an ideal time to review your retirement income plan as well as your estate plan and beneficiary documents, ensuring that both reflect your long-term vision. Ask questions about how your investments are performing, if you should make any changes, and how to best ensure that you are on track for retirement.

It is important to remember that annual financial reviews are not only for discussing past performance and suggested changes. They are also a great opportunity to create a plan for the future, set realistic goals, and ensure that you are making the best decisions to secure your financial future.

6. How can I maximize the returns on my investments?

Maximizing the returns on your investments is an important part of any personal financial review. Whether you need to diversify your portfolio, take advantage of tax-advantaged accounts, or invest for long-term growth, your advisor should be able to help make sure that you’re getting the most out of the market. 

Additionally, understanding market trends and choosing low-cost investments are key factors that can help optimize your annual return. By engaging in thoughtful consideration throughout the annual financial review process, you will be better equipped to make informed decisions about where to invest and when to buy or sell assets in order to maximize returns over time.

7. Is there anything else that I should consider when making decisions about my finances?

In addition to these questions, you may also want to discuss any changes in your personal goals or circumstances, such as a change in job, marriage, or location. These changes can have an impact on your financial situation and should be discussed with your advisor to ensure that your wealth management plan is still aligned with where you are today, as well as where you aim to be in the future. 

Ready to talk about planning for your financial future? Call Avidian Wealth Solutions today.

Planning for the future during your annual financial review is a critical part of managing one’s finances. By having a thorough understanding of one’s current situation and making plans for future events or investments accordingly, annual reviews become great opportunities for high-net-worth individuals to stay on track with their long-term goals while being proactive about their short-term needs.

At Avidian Wealth Solutions, we understand that annual reviews are an important part of anyone’s financial plan. We strive to provide comprehensive advice and guidance so that you can make informed decisions about your investments, retirement plans, and other financial strategies. Let us help you chart the path to a secure financial future. 

Contact us today to learn more about our Houston fiduciary wealth management services.

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