Take this financial evaluation to get an idea of how well you’ve planned your financial future. While the exact amounts of insurance, savings and investments vary by individual and family, this will give you a general idea of your current financial health.
Write your points on a separate sheet of paper to tally your score. All points for answers are all or nothing.
- If you have three times your monthly expenses in a readily accessible savings account, give yourself 10 points.
- If you have a checking or savings account at a banking institution, give yourself 5 points.
- If you earn interest on your checking account, give yourself 5 points.
- If the last time you received a salary increase (“raise”), you also increased the amount of money you regularly put into savings or investments, add 10 points.
- If you (and your spouse/partner) have laid out specific goals to achieve and you agree with them, add 5 points.
- If you review those goals at least once a year and measure your progress toward them, add 10 points.
- If you have a savings or investment account for your long-term goals (other than an employee pension plan or employer-sponsored retirement plan e.g., 401k, 403b), add 10 points.
- If you have added to and not withdrawn any money from this account for the past two years, add 10 points.
- If you are married and do not have life insurance coverage equal to at least two times your annual salary, subtract 10 points.
- If you have a long-term disability insurance policy that will pay at least 60% of your current salary should you become disabled, add 10 points. If your spouse has a disability policy, add 5 points.
- If you have no personal retirement fund (not including an employer-sponsored retirement plans or Social Security) to which you contribute regularly, subtract 10 points.
- If you have a current will and reviewed it within the last two years, add 10 points.
Less than 25 points: You are a financial novice.
Don’t despair. It’s never too late (or too early) to begin financial planning.
26-60 points: You are in fair shape.
You’ve taken steps in the right direction, so keep up the good work. A financial advisor can help you build upon the foundation you’ve laid.
61-80 points: You’re above average in planning for your financial future.
A financial advisor can help integrate the various strategies you’ve established in order to keep everything on course.
81+ points: Excellent job!
You are now ready for more sophisticated financial planning including estate conservation, tax minimization, etc.