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Annual Financial Planning

Updated: May 24, 2022

Creating a financial plan can help you map out how you want to handle your future finances. Even if you feel confident about how you have been handling things so far, considering your financial planning options with an experienced professional can give you financial confidence.

The Annual Financial Plan: What Is It?

An annual financial plan is a great tool to put all your financial decisions into perspective. The plan details the answer to the following questions:

  • What are your goals moving forward?

  • What issues or areas need to be addressed for goals to be met?

  • Where are you financially?

Your plan needs to reflect your age, income, debts, and assets. Those are the same factors that determine what the ideal starting point will be. Many of the details of your financial life should be considered, including your retirement outlook, taxes, and investments.

Take the following into consideration as you start to pull your annual financial plan together:

Additional Streams of Income

If you’re concerned about not saving enough for your retirement years, try to find additional ways to make money now. Be sure to develop additional income streams for retirement well beyond investment accounts that are taxable and tax-advantaged. Would you be able to put your income into someone else's business through investment, giving your income a boost as a result?

Asset Allocation & Fees

When looking at your investments, you should consider how much you’ll be saving and where you will be investing. What are the costs and benefits? The greater the potential return of an investment usually entails being willing to accept greater risk and/or the loss of principal.

Investing and Retirement

Retirement planning is often overlooked or delayed because a lot of people do not prioritize their finances. A Federal Reserve survey from 2020 showed that over a quarter of Americans have no retirement savings. On the other hand, less than 40% think their retirement savings are where they should be. Ouch, let’s make sure we are not on that list!

Set up an appointment with a fiduciary-focused financial planner, like Michael R. Rose to develop your retirement plan. Together, you can determine how much you can invest in an IRA and if you can invest any additional funds.

Life Events

You should consider changing your financial plan when you reach major life milestones, like getting married or having a baby. For example, if you have younger children, you should factor in saving for their college education. Maybe you’re a 20-something who recently got married, so you need to focus on saving enough money for a down payment on a first home.

You should think about each major life change individually and decide how it will affect your financial plan.


Tax-related issues are important to take into consideration during the annual planning of your finances, especially if there are any investments in an account that are taxable. It includes preparing to pay capital gains tax if you sold any securities for a profit over the past year.


Annual financial planning plays a vital role in overall financial health. It's a great way to establish a guide that involves the current situation and future goals. When creating a plan, keep several factors in mind, such as taxes, asset allocation and fees, and major life events.

Searching for a Financial Advisor to guide you in your financial decision-making process? Call fiduciary-focused LPL Financial Advisor Michael R. Rose today!

Michael R Rose and LPL Financial do not provide legal advice or tax services. Please consult your legal advisor or tax advisor regarding your specific situation.

All Investing involves risk including loss of principal. No strategy ensures success or protects against loss.

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