End of Year Strategies: Scheduled Financial Maintenance for 2017

You know there are financial matters you need to take care of throughout the year, but you may not know when you should be addressing them. For dentists who run their own practice or participate in a partnership, annual financial calendars should include business reviews as well as personal reviews. This brief guide will help you, over two parts.

Review 2016 portfolio performance and make necessary 2017 adjustments.

Now.

Even if your fiscal year for business purposes ends at a time other than December 31, it’s a good idea to use the end of the year to take a look at past performance and make adjustments. There are several reasons, though, why now is a good time to do it. Reviewing your portfolio and re-balancing your investments are like auto maintenance —always needed, entirely necessary, and easily forgotten or put off. As every dentist knows, many patients see regular maintenance as a “nice to have” rather than a “need to have.” Don’t fall into that same trap when it comes to meeting your financial goals.

Why are annual reviews so important? Because priorities change, and financial goals are not set in stone. Use this time to check your progress, verify the performance of any advisor you may be working with, and look at any needs for immediate liquidity.

Gather tax information.

End of January.

By January 31, with a few minor exceptions, employers, financial institutions, and others who have documents related to your tax liability are required to send them to you. If you work for a dental system, you’ll have your full information by then. While you don’t have to do your taxes at that time, it’s a good idea to get all your paperwork to your tax professional as soon as possible. Or, if you do your taxes yourself through an online program, you can get an early sense of what your liability or refund may be. If you owe, you can wait until April to submit your taxes and payments, or later if you get an extension. (Don’t make the mistake, though, of thinking an extension allows you to file your taxes later; it does not!) If you’re expecting a refund, you’ll want to submit your tax returns sooner. Why? Because that’s your money that your Uncle Sam is earning interest on.

Review wills and beneficiaries.

Early spring.

Consider this task a part of spring cleaning. Each year, you should look over your retirement plan documents, and discuss beneficiaries with your advisor and your partner and other family members to make sure nothing has changed and the money will go where it’s supposed to in the event of your untimely passing.

Insurance review.

Now.

Why now? For the same reason you should review your portfolio performance now; because otherwise this may get pushed to the back burner, where it decidedly doesn’t belong. Life insurance is an obvious need, but depending on your age and overall health, you may also consider long-term care insurance, disability insurance, updating your malpractice coverage, and any other needs you should address.

When it comes to insuring your practice, there is a long list of variables, including new services you’re now offering, changes to Federal and State Laws regarding dental malpractice, and recent court decisions that could prompt a change in your malpractice coverage. Talk to your malpractice insurance provider to make sure you’re up to date.

Asset protection.

Fall.

It’s not as if this step is any less important than any of the tasks above, but the simplest way to become overwhelmed is to over-schedule the beginning of the year.

If you run your own practice, or if you simply have significant assets you’ve built up over time, it’s a good idea to consult an asset protection attorney to make sure you’ve minimized your personal and business liability. Make sure your dental malpractice insurance is sufficient and up-to-date. Is your risk management plan as robust as it needs to be? An annual review can help make sure that it is.

Of course, there are many other steps you’ll need to take during 2016 to make sure you stay on track. Having a basic calendar in your head or on paper will help you navigate the new year.