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    Spring Clean Your Portfolio

    By Brandon Miller, CFP–

    Spring cleaning isn’t just for closets and cobwebs. Your investment portfolio could probably use a little refreshing as well, especially if you haven’t aired it out in some time.

    Yeah right, you may be thinking. I’ll fit that in after I schedule a root canal, clean the gutters and give the cat a bath.

    May I suggest that you turn that thinking around a bit? You’ve likely worked hard for the money you save and invest, and want to use it to finance your dreams. But investments that don’t align with your goals may not move you closer to them, or may slow your progress versus what you could achieve with the right mix. Isn’t getting what you really want in life worth an hour or so of your time to do a little portfolio tidying up?

    If yes, then ask yourself these questions:

    Am I on track?

    Have your goals changed from the last time you reviewed your portfolio? Marriage, divorce, birth and death—not to mention changing careers, moving, health issues or any number of other factors—can have a profound impact on what you want or need your money to do.

    Determine the purpose of each investment: retirement, vacations, household expenses, a condo in the desert. Is what you own still relevant and still moving you toward your goals? Are you putting the right amounts into the right accounts? Remember also to bear in mind your timeframe for achieving each dream.

    Also, look to see if your mix of assets is right for you today. Do you have a diverse choice of investment vehicles, such as bonds that perform well in bear markets and stocks that soar when things turn bullish? You want to be prepared for whatever the market sends your way. 

    Is my investment strategy tax efficient?

    Being tax smart can keep Uncle Sam from dipping deeper into your pocket. A combination of tax-advantaged investments (e.g., Roth and Traditional 401(k)s and IRAs), tax-efficient investments (e.g., index mutual funds and ETFs), tax-exempt bonds (e.g., municipal and U.S. Savings bonds) and taxable accounts give you great flexibility in when you pay taxes and how much you pay.

    There are also strategies—such as tax-loss harvesting, which uses gains to offset losses—that can reduce your tax burden. (See next month’s Money Matters for some tax-smart tips.)

    If you’re at that stage of life where you’re drawing down on your savings, set up a tax-savvy withdrawal strategy. This could mean depleting taxable accounts first, then tax-deferred accounts and finally tax-free investments, such as Roth IRAs.

    Do I have adequate protection?

    No, this is not about condoms or PrEP. It’s about making sure unforeseen circumstances don’t ruin everything you’ve been working for.

    If you still have many years left to work and couldn’t get by without your salary, disability insurance might be very important. Or maybe you’re financially independent and don’t need this coverage any more.

    Has your family grown? You might need more (or some) life insurance. Or if you’re older, you may not need any or as much coverage. That money may be better spent on a health or long-term care policy.

    Here again, it’s critical to consider your current goals and timeframes when reviewing your safeguards.

    Is my estate in order?

    Tax and estate laws are always changing, as are your assets and the people you want to protect. Make sure your will, healthcare proxy, power of attorney, living trust and other documents still reflect your wishes.

    And by all means, update your beneficiaries for all official documents and investment accounts. I can’t tell you how many clients I’ve saved from leaving their retirement accounts, homes and more to an ex they haven’t spoken to in years.

    This Spring, make a date with yourself to clean up your portfolio. Toss any investments that no longer suit your goals and find new ones that are a better fit for who you are today and where you want to go tomorrow.

    Or just hire a financial professional to do it all for you. Maybe I should have started with that point.

    The opinions expressed in this article are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security. The material is presented solely for information purposes and has been gathered from sources believed to be reliable, however Brio cannot guarantee the accuracy or completeness of such information, and certain information presented here may have been condensed or summarized from its original source. Brio does not provide tax or legal advice, and nothing contained in these materials should be taken as such. To determine which investment may be appropriate for you, consult your financial advisor prior to investing. As always please remember investing involves risk and possible loss of principal capital; please seek advice from a licensed professional.

    Brio Financial Group is a Registered Investment Adviser. SEC Registration does not constitute an endorsement of Brio by the SEC nor does it indicate that Brio has attained a particular level of skill or ability. Advisory services are only offered to clients or prospective clients where Brio Financial Group and its representatives are properly licensed or exempt from licensure. No advice may be rendered by Brio Financial Group unless a client service agreement is in place.

    Brandon Miller, CFP® is a financial consultant at Brio Financial Group in San Francisco, specializing in helping LGBT individuals and families plan and achieve their financial goals.