Fidelity Investments: Time for a Mid-Year Financial Checkup

June 13, 2018 — 3:45 PM EDT

Nearly six months into the volatile stock market of 2018, investors may be breathing a sigh of relief, assuming that the summer months will be quiet, with many people focusing on vacations and barbecues. But Fidelity Investments said that now isn't the time for investors to rest on their laurels but rather to engage in a mid-year checkup of their financials and investments.

"A mid-year checkup can accomplish several things. You can stop and think about your financial goals, such as saving for retirement, a house, a child's education, or a financial cushion, and then make sure that you are investing appropriately for those goals," wrote the Boston-based fund company in a recent blog post.

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Take financial goals for starters. Heading into 2018, stocks were setting new highs seemingly every month, with little if any volatility in the markets. That all changed this year, with stocks suffering through a correction in mid-February. Since then, stock prices have increased but have been bouncing along. Many expect volatility to increase again during the summer months as geopolitical issues continue to dominate the news. As a result of all that, Fidelity said that investors should use the six-month mark to make sure the investments and savings match their goals and priorities.

As far as saving for a new home or for college, the fund company noted that the current real estate market or college tuition costs may require shifting those goals. The same goes with retirement savings. The six-month mark is a good time to make sure you are saving enough for retirement and determine if that level can be increased. It's also a good idea to check the beneficiaries you listed on your accounts. "Your retirement account assets (for instance money in a 401(k) or IRA) pass directly to the beneficiaries you designate with your account custodian, trustee, or plan administrator. Your beneficiary designations supersede any directions in your will for your retirement account – so who you name as beneficiary is important," wrote Fidelity.

On the investment front, Fidelity said investors should look at their portfolio mix to ensure that it is still meeting their needs and goals. Given the stock market's performance this year, some changes to the asset allocation could be required. Fidelity said to start with looking at your mix of stocks, bonds and cash to see if dovetails with your investment horizon, risk tolerance and financial situation. Rule of thumb: if any allocations are more than 10% away from the target, investors may need to rebalance back to the desired investment mix.

After that, Fidelity said to look at the specific investments and their role in the portfolio. "If you own mutual funds, see whether they are performing as you expected and if there have been any changes to the fund's investment approach. If you own stock in individual companies, evaluate each company's current status and prospects, and decide whether they justify keeping it in your portfolio," wrote Fidelity.