We spend hours searching for flight deals or plan our shopping around Black Friday to save a few hundred dollars. But one focused hour on your finances could potentially uncover thousands in savings, reduce hidden risks, and sharpen your retirement plan.
A ‘Financial Life Audit’ may be one of the most valuable things you can do for your future. Whether you’re heading into retirement or just trying to stay financially organized, this quick and detailed checkup helps ensure everything in your financial life is aligned, efficient, and working toward the goals you care most about.
Below is a simple checklist to guide your audit. You don’t need to do everything at once, but reviewing even a few of these areas can make a big difference. With AMM as your trusted partner, we’ll review asset placement, eliminate unnecessary overlap, and help ensure your plan supports what matters most to you.
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Check Your Beneficiaries
This is one of the easiest and most impactful steps to take. Review the listed beneficiaries on your:
- IRAs and 401(k)s
- Life insurance policies
- Transfer-on-death (TOD) brokerage accounts
- Bank accounts with payable-on-death (POD) designations
Too often, these designations are outdated, missing, or list someone unintentionally; like an ex-spouse or a deceased relative. These designations override your will, so it’s critical that they reflect your current intentions.
In addition to naming primary beneficiaries, be sure to include contingent (secondary) beneficiaries to ensure continuity. If minors are among your intended heirs, consider whether establishing a trust might offer more appropriate oversight and long-term protection. Review beneficiaries at least annually or after any major life event (marriage, divorce, birth, death).
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Review Account Overlap and Investment Allocation
If you have multiple investment accounts, especially across different custodians, you may unintentionally be holding too much of one sector, company, or risk factor. While diversification helps reduce risk, uncoordinated portfolios can cancel out thoughtful strategies.
- Are your accounts invested consistently with your risk tolerance and goals?
- Is your asset allocation too aggressive or too conservative across the board?
- Do you own the same or very similar funds in multiple places without realizing it?
A consolidated review of all your accounts can help eliminate duplication, lower costs, and potentially improve long-term performance. Consider reviewing your asset location as well to optimize tax efficiency across taxable, tax-deferred, and Roth accounts.
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Confirm Tax Withholding and Estimated Payments
Tax surprises can be frustrating and expensive. If your income or deductions have changed this year, your withholding or estimated tax payments may need an adjustment.
- Are you on track with your quarterly tax estimates (if applicable)?
- Did you update your W-4 if your income, dependents, or deductions changed?
- Are you under-withholding from Social Security or IRA distributions in retirement?
Fine-tuning your withholding could help you avoid underpayment penalties or avoid giving the IRS an interest-free loan.
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Revisit Your Estate Plan
When was the last time you reviewed your estate documents?
- Are your wills, powers of attorney, and healthcare directives still current?
- Does your trust (if you have one) reflect your current wishes and family structure?
- Have you retitled assets appropriately into your trust (a common oversight)?
Estate planning isn’t just about wealth transfer; it’s about avoiding probate, reducing stress for loved ones, and ensuring your wishes are carried out clearly and efficiently. Don’t forget to account for collectables, digital assets, or online accounts, which many modern plans now include.
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Identify Missing Insurance or Risk Gaps
Risk management is often overlooked until something goes wrong. An annual review of your insurance coverage can prevent costly surprises later.
- Is your umbrella liability policy still sufficient for your net worth?
- Do you have enough (or too much) life insurance?
- Have long-term care options been considered as part of your retirement planning?
- Are you still insuring any assets you no longer own?
Your insurance needs evolve with changes in net worth, family structure, and lifestyle. Make sure your coverage grows (or shrinks) with you.
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Confirm Required Minimum Distributions (RMDs)
If you’re age 73 or older (or inherited a retirement account), you may be required to take minimum distributions from your tax-deferred accounts. Missing an RMD can trigger steep penalties of up to 25% of the amount you should have withdrawn.
- Are you on track to meet your RMD by year-end?
- Have inherited IRAs been reviewed for proper distribution rules?
- Could a Qualified Charitable Distribution (QCD) reduce your tax bill and support causes you care about?
This quick review can ensure you meet your obligations and potentially lower your taxes while benefiting your community.
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Review Cash Flow and Savings Automation
Sometimes, small operational tweaks can generate major benefits over time.
- Are you auto-saving into retirement accounts, a high-yield savings account, or a 529 plan?
- Are there unused subscriptions or recurring expenses you could cut?
- Are credit card rewards or checking accounts still the best fit for your spending habits?
- Is your spending aligned with your values and current priorities?
This is also a great time to confirm your emergency savings account is sufficiently funded.
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Evaluate Roth Conversion Opportunities
If your income is temporarily lower this year, due to retirement, a career change, or a gap year, it may be an ideal time to convert part of your traditional IRA to a Roth IRA.
- Have you filled your current tax bracket?
- Would this year’s tax rate be lower than your expected future rate?
- Can you pay the conversion tax from outside the IRA?
Even small conversions, done strategically over time, can reduce future RMDs, increase tax-free retirement income, and help position assets for tax-efficient inheritance.
Why This Hour Matters
A one-hour audit won’t overhaul your entire financial picture, but it often reveals small oversights that carry big consequences. From avoiding penalties to reducing taxes and eliminating duplicate accounts, a little structure can go a long way.
Whether you do this on your own or with a financial advisor, taking the time to pause, reflect, and recalibrate can reduce stress, prevent costly mistakes, and help you feel more confident in your path forward.
Ready for a check-in?
If you’d like help walking through your own Financial Life Audit, our team of CERTIFIED FINANCIAL PLANNER™ professionals and our in-house CPA at AMM are available to help you align everything—one step at a time.
Let’s make sure your plan is working as hard as you are.
