The end of the year is a natural time to take stock of your financial picture. This includes the insurance coverage that protects your income, family, and assets. Life changes, inflation, and shifting financial goals can all affect how much coverage you need. A quick review now can help ensure your protection plans keep pace with your life.
Review Your Core Coverage
Start by revisiting your key insurance policies to make sure coverage levels are still appropriate:
- Life Insurance: Have your needs changed due to a new home, marriage, children, or business? Your coverage should reflect your current financial responsibilities and long-term goals.
- Health Insurance: Compare plan options during open enrollment to ensure your coverage matches your expected healthcare needs.
- Disability Insurance: This often-overlooked protection helps replace income if you’re unable to work due to illness or injury. If your income or employer coverage has changed, a review may be worthwhile.
- Home and Auto Insurance: Rising home values and inflation can leave gaps in coverage. Check policy limits, deductibles, and liability coverage to confirm they’re still adequate.
Update Beneficiaries
Life events such as marriage, divorce, or the birth of a child can make beneficiary updates especially important. Review and update beneficiary designations on:
- Life insurance policies
- Retirement accounts (401(k), IRA, etc.)
- Annuities or other financial accounts
These designations override what’s written in a will, so keeping them current ensures your assets are distributed according to your wishes.
Consider Long-Term Care Planning
If you’re approaching retirement, or helping aging parents, long-term care planning is an important part of financial security. The costs of assisted living, nursing care, or home health services can add up quickly.
Options may include:
- Traditional long-term care insurance for dedicated coverage, or
- Hybrid policies that combine life insurance with long-term care benefits.
A financial professional can help you evaluate which approach fits your overall retirement and legacy strategy.
Align Coverage With Your Broader Protection Plans
Insurance isn’t just about protection. It’s a core component of financial planning. Ensuring your policies align with your savings, investment, and estate strategies can help reduce risks and keep your plan balanced as your life evolves.
The Bottom Line
Taking time now to review your insurance and protection strategy can help you start the new year with confidence, knowing you, and the people who depend on you, are covered. Small updates today can make a big difference in your long-term financial well-being.
