Time for some financial spring cleaning?

Now that April is here, you might decide to spruce up your home, both inside and out. But you also may want to do a little “spring cleaning” to help keep your financial house in order.
What steps should you take to tidy up your financial situation? Actually, some of the moves are the same as those you’d use to reinvigorate your house and yard. Consider the following:
*Get the clutter out. When you open some of your closets, you probably ask yourself: “Why on earth do I need that?” Strange as it may seem, when you open your investment portfolio up for examination, you might have similar thoughts. Perhaps you’ve had some investments for so long that you no longer remember why you bought them. If you aren’t sure why you own a stock, bond or other type of security, you might want to sell it and use the proceeds to invest in something else that might be more useful in helping you meet your goals.

*Rearrange the furnishings. Over time, and almost without your being aware of it, the furnishings in a room can get “out of balance.” Perhaps you have too many chairs in one corner, or maybe your new entertainment center is crowding out a couch. Usually, with a little rearranging, you can get things back in order. And the same is true with your portfolio: Over time, it might have become unbalanced, with too much of one investment and too little of another. This situation could prove hazardous to your financial situation, especially if the imbalance means you are taking on too much risk or, conversely, if your holdings have become too conservative to provide the growth you need. A well-balanced portfolio can help you achieve your long-term goals and accommodate your individual risk tolerance, but it won’t assure you of a profit or protect against a loss in declining markets.
*Update your home’s “look.” If you’ve lived in a place for a long time, the rooms and even the landscaping can start to look a little “frumpy.” Perhaps the way you lived in 1997 isn’t quite the way you’d like to live in 2007. So, you make some changes. And when you look at your investment portfolio, you might also think that some elements aren’t reflecting new realities of your life, such as marriage, divorce, a new child, a child going off to college or impending retirement. If this is the case, you may need to adjust your holdings.
*Check your security system. It’s always a good idea to check your smoke detectors and alarm systems to make sure they are functioning properly. And, just like your home’s security features, your life insurance needs to be checked periodically. If you’ve moved to a more expensive home, or if you’ve added a child to your family, is your insurance still sufficient? Or, if you have recently remarried or divorced, have you changed your beneficiaries?
As you can see, you can gain a lot of benefit from a financial spring cleaning. Get started soon.