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Your 2012 financial planning checklist
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For 2012, I’ve put together a checklist to help you take a deeper look at your financial picture, address a few important areas of financial planning, as well as provide you with some suggestions for the new year.


The Basics

• Create a financial plan. By setting long term and short term life goals, a financial plan helps you see the big picture. With a strategy in place, your goals are measurable and financial decisions have greater clarity and less stress. If you don’t already have a plan, make one. Check out for more info.


Estate Planning

• Get a will. If you don’t have a will, the state of Georgia has one for you. A will give you the ability to decide who receives what of your assets rather than the court making the decision.

• Review Existing Will. If your will lays out a division of different types of assets among the heirs, you may have some problems because asset values change. For example, if real estate was left to a daughter and stocks left to the son, those values today may have changed considerably. Also consider that the federal basic exclusion amount in 2012 is $5,120,000, and is scheduled to "sunset" (revert to $1mm) on January 1, 2013.

• Georgia Advance Directive of Healthcare. Designate someone to make medical decisions for you, instead of the court, should you become incapacitated. and select "Publications" on the left side for the form.


Insure Your Assets

• Your assets are more than just home, auto and life. Do you have replacement cost coverage? If you are still working, your earnings need to be insured with disability coverage.

• Can you afford a $74,000 a year bill during retirement? If you answered no, then insure your nest egg by investing in a long-term care policy. 70 percent of Americans over age 65 will need some level of long term care. For more information, read my previous article titled "Long Term Who Cares?"





• Read the No. 1 New York Times Bestseller, "The Investment Answer" by Gordon Murray and Daniel Goldie. This 63 page book will have a direct impact on your long term investment performance by showing you how to become a smarter investor.

• Do you have a diversified portfolio? Diversification doesn’t mean having several advisers, brokerage companies or different mutual funds. Real diversification is means investments in many different asset classes such as stocks, bonds, real estate, commodities, international securities and alternative investments.

• Know your risk. Markets come with risk. Do you know your risk tolerance profile? Make sure you are getting the most return with the least amount of risk. Ask for a risk/reward profile on your portfolio based on your profile. For example, if you have a conservative risk profile, you shouldn’t have a benchmark based on the S&P 500.


Andrew Brown is a Certified Financial Planner and a Fee-Only Registered Investment Advisor.