Take a cue from the rich: Do a midyear financial check-in

By Beth Pinsker

Financial advisers would tell you to rebalance your portfolio at a midyear check-in. Make these 4 money moves instead.

Taking stock of your finances over the summer means looking at the big picture, not necessarily at your stock holdings.

If you aspire to live like a wealthy person, give yourself a midyear financial checkup this summer.

This is what high-net-worth folks with financial advisers do. They talk about adjustments to optimize a portfolio strategy. They might hear a lot about the market trends with small-cap versus large-cap stocks, turmoil in the oil markets and inflation. All of this would happen because the financial professional had read the midyear reports raining down from major financial institutions.

If you're handling your own finances, you can likely skip most of this. "If you don't do it yourself, the market tends to do it for you," said Stuart Ritter, insights director at T. Rowe Price.

This is not neglect, but rather a choice the majority of people make for active management, because they don't want to pay constant attention to their portfolios. If most of your investible assets are in your 401(k), as shown in the latest Vanguard "How America Saves" report, you are likely using a target-date fund, and the fund will be adjusted by the managers. For holdings you have directly in stocks and bonds in a taxable account, you probably are not getting too deep into the weeds of the merits of one sector or another, and you can leave your asset allocation alone.

But there are other things to consider. "I believe, at minimum, you should be doing a review two times a year - midyear and year-end," said Rich Guerrini, chief executive of PNC Wealth Management. That frequency might increase as you have big life changes. Guerrini, who is 62, said a quarterly cadence would make more sense for somebody his age who is getting closer to retirement.

The most important part of the midyear financial review is an overall assessment of goals and where you are on the journey to reach them, and then an assessment of any life changes that might be affecting your progress. Here are four steps that experts recommend you take.

1. Push up your savings rate

Did you get a raise this year? Chances are you either got one in January, after you had already set your plan for the year, or you're expecting one around now, in summer. Either way, you want to look at pushing up your retirement contributions. You could raise your contributions by 1 percentage point, which would have a huge impact down the road but not make that big a dent in your paycheck. Or you could look even more broadly at how you are saving.

"Are you using the best tax-advantaged account for your savings?" asked Ritter. "A lot of people just do pretax and don't think about Roth, but maybe Roth is appropriate for you. Think about it at the account level - that's a decision you get to make."

You can look at your latest pay stub and see your year-to-date tax withholding and your year-to-date retirement contributions, and think about whether switching to post-tax contributions would make a difference. If you're over 50, you can also see if you can push yourself to make catch-up contributions.

2. Put your cash to work

The traditional definition of "rebalancing" is to sell or buy investments to get your overall portfolio back to the target ratio you designated for your financial plan. You might be going for a traditional 60/40 split of stocks and bonds, or perhaps something like 60% stocks, 30% fixed income and 10% cash.

With the upward trend of the stock market in 2026, what's most likely to be going on in your portfolio is that cash has been piling up, perhaps from dividends that were not automatically reinvested, bond yields or maybe even an IRA contribution from last year that you never got around to allocating.

Jeff Judge, a certified financial adviser based in Maryland, encourages his clients to put that money back to work when he meets with them at midyear. And he certainly doesn't want them to panic sell because they think a roaring market means a crash is coming. At one of his recent midyear reviews, a client asked him if he should put everything into cash because of something he saw on social media about a coming "reset."

"The clients who panic in summer are almost always the ones who skipped their last review. My best midyear move is talking someone out of a move," Judge said.

3. Fix your blown budget

This has been an expensive year for many, and now is a good time to see where you are in the spending plan you set up for the year, especially if you are already in retirement. Summer trips might blow a hole in your winter holiday travel plans, for instance.

"Do you need to alter your plans? Drive instead of fly, or shorten a stay?" Guerrini asked.

If you're in retirement, perhaps what you really need to do is free up more cash so that you can meet your spending needs. That requires assessing what's available in your holdings. You might want to lock in profits from a stock investment that has grown a lot, or sell something that tanked and use that loss for tax purposes to offset your gains.

"Summer is the right window for that work. You have time to be deliberate instead of reactive," said Judge.

4. Think even longer term

The end of the year is always a rush time for financial planning. Tax deadlines are looming and there is not a lot of time left on the clock to make adjustments. If you decide to save more in your 401(k) in December, for instance, the change might not even kick in until the new year.

So if you're taking the time to look at your financial life in the summer, truly evaluate the situation. Think about your insurance coverage, your beneficiary designations and your long-term plan.

One business owner met with financial planner Jon Ulin recently in Florida and asked if he should delay selling his company. "He believed [artificial intelligence] could double its value over the next few years," Ulin said. "Those conversations often become more about managing expectations than managing investments."

Another thing to consider is your legacy plan for your money. "Estate planning is always a topic. No one seems to want to get organized and get their documents established," said Judge.

Everything about financial planning comes back to this goal setting, said Ritter. The whole process "should be driven by your goals, time horizon and personal circumstances. What that means is that what's going on around you should have less of an influence," he said. "At the beginning of each year, you say this is most important and here's how we expect to spend our money. Then life happens, as we look toward the second half and see what priorities we need to shift."

Ritter knows this sounds like repetitive, old-fashioned advice. "People say: 'That advice was great in the past, but times are different now - there's AI and oil and inflation.' But it's not like 'different' has never happened before."

The basics still matter most: Align your goals to your time horizon and save the right amount to get the job done. "It's the biggest thing you can control. This puts you in the best position for whatever future actually happens," Ritter said. "Then you revisit it all at the end of year, and next summer we'll have the same conversation."

Got a question about investing, how it fits into your overall financial plan and what strategies can help you make the most out of your money? You can write to me at beth.pinsker@marketwatch.com. Please put "Fix My Portfolio" in the subject line.

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