5 Reasons to Spring-Clean Your Retirement Plans

Financial graphs and a stack of binders, one marked "retirement plan" are arranged on a surface along with a cup of black coffee.
(Adobe Stock)

I love the idea behind spring cleaning. A few of the beneficial byproducts of a thorough spring cleaning -- in any part of your life -- include a fresh start, removal of waste, new energy or ideas, and, of course, organization and elimination of clutter. When I think about those specific outcomes, it's clear that focusing some of your spring cleaning on successful retirement plans and investments can yield beneficial results.

Consider the following reasons:

1. A Fresh Start

Over the years, especially with mobile military families, I've reviewed balance sheets that included retirement plans from across the country. What do these accounts typically have in common? They are seemingly small, mostly forgotten, and normally poorly maintained. Consolidating your IRAs and old retirement plans could provide an almost unrecognizable makeover to your retirement efforts. Heck, you may be surprised at all you have when everything is gathered in one place.

2. Removal of Waste

Let's face it, we've all made mistakes. In a retirement portfolio, mistakes might have included poor investments that underperformed, expensive investments or accounts, or even poor relationships. Sometimes, it can be a hassle to close those accounts, sell those investments or end those relationships. However, there is no time like spring to make it happen. The old saying, "Bad news doesn't get better with time," holds true here. This year, haul your waste to the dump.

3. New Energy or Ideas

As you clean up your retirement accounts and investments, you might also reinvent your approach. That could take the form of a clearer vision of what retirement (or reinventing work!) might look like and the associated price tag. It could mean closely examining the utility of converting retirement assets to Roth. Perhaps a different approach to the "right" portfolio will result from your spring cleaning. The bottom line: Dedicating the time and energy to this effort could yield a new sense of purpose and priorities.

4. Organization

Whether you're trying to find the right tool for a job or just track down some glue, tape or foam to weatherproof your pipes (yes, these are all recent realities that have shaped my own spring), a thorough cleaning can get you organized. With your retirement portfolio, that could mean an assessment of where you are relative to your goals -- how your money is arrayed in terms of tax treatment, investment allocation and, most importantly, the ability to effect change in any of these areas. Just do it.

5. Elimination of Clutter

More can be less. With your retirement portfolio, too many accounts in too many places or even too many holdings can hinder your ability to see where you really stand in terms of allocation or even accumulation. Too often, I've worked with people who were shocked when we started to dig into some long-forgotten retirement accounts: "Wow, I had forgotten all about that."

This spring, freshen up more than just your home and garden. Expand your efforts to prepare for a successful retirement.

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