Financial Planning in Sonoma County: Tips for a Successful 2022

Financial Planning in Sonoma County: Tips for a Successful 2022

You just closed the books on 2021. 2022 is underway! It’s important to put financial planning for this year at the top of your to-do list. This guide will help you do it.


Invest in Yourself by Working With a Financial Advisor

Brokerage accounts, mutual funds, stock portfolio, and more. All of these components of your financial life are important and require a certain amount of TLC. But, it can be hard to find the time to complete the due diligence needed to ensure that all of these important assets are consistently working together. 

What’s more, your financial needs, goals, and overall picture can change over time, adding another variable to your plan. 2022 looks to be a very dynamic year in the financial markets. Are you prepared for the impact that inflation is going to bring? Ultimately, it can be very difficult to implement a holistic strategy over time.


An Advisor can Align Every Piece of Your Financial Picture

One of the easiest ways to remedy this challenge is to work with a dedicated financial professional. Your financial advisor can be your go-to resource to ensure that all of your assets work together, and are specifically driven by your financial goals. Your investments and various financial assets are the vehicles to get you to your goals.

In 2019, a survey found that 99% of Americans don’t use a financial advisor, which severely hamstrings their financial future. Your financial advisor helps you maintain the peace of mind that your financial life is on track, and is being implemented on your behalf.


Find out how to protect your family’s wealth.  Contact Montgomery Taylor Wealth Management in Santa Rosa CA to see how we can help.


Review Your Plans and Rebalance if Necessary

Suppose you work with a financial advisor. They put together a comprehensive, game-winning financial strategy and invest it for you. What’s next? In order to maintain this solid level of oversight for your portfolio, you must consistently review your plan, and rebalance if you need to. This is extremely important throughout the year. 


Not All Assets Move in Tandem

Stocks, bonds, and their many sub-categories often move in different directions. The S&P 500 has grown over 20% but this isn’t the case for other investments like bonds or even global stocks, and vice-versa. Therefore, the many assets in your portfolio (put together and managed by your advisor) need to be reviewed, and possibly rebalanced, at least once a year.

The act of rebalancing simply means looking at your originally recommended portfolio allocation, comparing it to how it looks now, then selling or buying certain investments to set it back to fit your recommended allocation. It may sound like a lot of work, but don’t forget, your advisor will do this all for you.

Click here to take the Montgomery Taylor Risk Questionnaire to find what risk tolerance best suits you. We use this tool to compare your risk comfort level with your current portfolio and to help suggest the right allocations for you going forward. 


Take a Look at Your Tax Situation

The importance of proper tax management cannot be overstated. As the old saying goes, it’s not just how much you earn, but how much you keep. To this end, maximizing your tax efficiency can save you tens of thousands of dollars (if not more) over your lifetime and in retirement.

Take time to meet with a tax advisor or your full-service financial advisor annually, to estimate your income level, and find ways to strategically make your income more tax efficient. This might mean deciding which retirement account (pre-tax or after-tax) is best to use for the year, charitable donations, and many other important deductions. This can also mean long-term strategies like forming a trust account and finding efficient ways to give financial gifts to your future heirs now.

As a wealth management firm, the Montgomery Taylor team provides tax planning in addition to financial planning and investment advice. The combined benefits of a CFP + CPA is a big advantage over many other financial service providers. We can provide advice on how to minimize your tax liability in order to keep more of your hard-earned money.


Determine Your Goals for the Year 

Your financial plan should always be driven by your specific goals. Your goals must be re-reviewed and established at least each year, or sooner if necessary. Financial resolutions are very common in America, but some struggle to stay consistent after a few months into the new year.

Looking to boost your retirement investments in 2022? Buy a new car? Increase college savings for a child? Consider a 529 account for children or grandkids. Once you’ve determined your financial goals, your advisor can put together a plan to make it happen.


Establish Concrete Steps for How to Meet Those Goals

Your goals help create your financial roadmap. Once your goals are confirmed, you can take action. For the most part, taking action means either dedicating more savings to a particular account, adjusting your portfolio, or establishing new accounts. Your comprehensive financial advisor is key in quickly making these moves.


Cut Costs You Don’t Need 

Saving more money can make your life much easier in the new year. When looking to save money. Start with some of the most common money wasters out there. According to AARP, one of the most common money leaks consumers miss is a ‘ghost subscription,’ or any routine payment that is either forgotten about or unused.

Frequent culprits in this category are unused gym memberships, trial subscriptions of certain smartphone apps, or online services left uncancelled. These common money pits can be extremely easy ways to keep more money in your pockets without changing your quality of life. 


Automate Your Contributions 

As consistency is key to developing any good habit, so too does consistency help your finances. The most effective way to ensure that any savings goal is met is to automate your contributions. Rather than manually parting ways with your money, setting up an automatic transfer or deposit helps your financial engine work for you in the background. This strategy is also effective for charitable contributions. Though it seems simple, you’ll see a considerable difference in your savings over time.


Start 2022 Financially Strong

The start of a new year is always exciting. As you work on your personal resolutions, this guide will help you make sure you achieve your financial ones. From saving to investing, now is the perfect time to take another look at your money and finances, and enlist the help of a certified financial planner. After a few simple (but key) financial decisions, you’ll see a major upgrade in your financial life in the new year.


Montgomery Taylor Realistic Financial Planning


At Montgomery Taylor Wealth Management, we understand the challenges of retirement planning and can help put together a plan to protect your family’s legacy. Contact us to find out how we can help you!