Financial Fitness Check: Why Financial Year-End Is the Perfect Time to Review Your Assets and Portfolio Allocation
Much like an annual health check-up, reviewing your financial position at year-end can help ensure your wealth-building strategy remains aligned with your goals, risk tolerance, and changing market conditions. Whether you're building wealth, planning for retirement, or managing a diversified investment portfolio, a financial year-end review can help identify opportunities, manage risk, and position you for future success.
Take Stock of Your Financial Position
The first step in any financial fitness review is understanding exactly where you stand today. Review all your assets and liabilities to calculate your net worth — a valuable snapshot of your overall financial health and a useful way to track progress over time.
Assets to Review
- Cash and savings accounts
- Investment portfolios
- Superannuation accounts
- Real estate investments
- Business interests
- Managed funds and ETFs
- Alternative investments
Liabilities to Review
- Mortgages
- Personal loans
- Investment loans
- Credit facilities
Calculating your net worth provides a valuable snapshot of your overall financial health and helps track progress over time.
Review Portfolio Performance
Financial year-end is the perfect time to assess how your investments have performed over the past 12 months. Rather than focusing solely on returns, evaluate whether your portfolio continues to support your long-term financial goals.
Ask Yourself
- Has my portfolio achieved its intended objectives?
- Am I comfortable with the level of risk I'm taking?
- Which investments contributed most to performance?
- Are there underperforming assets that require review?
Review Your Portfolio Allocation
One of the most important aspects of successful investing is maintaining an appropriate asset allocation. Market movements can cause portfolios to drift away from their intended targets. For example, strong share market gains may increase your exposure to equities beyond your preferred risk profile.
Review your allocation across both growth and defensive assets:
Growth Assets
- Australian shares
- International shares
- Property investments
- Alternatives
Defensive Assets
- Fixed income
- Bonds
- Cash and term deposits
If your portfolio has drifted significantly, rebalancing may help restore your desired asset mix while maintaining a disciplined investment approach.
Assess Diversification
Diversification remains one of the most effective tools for managing investment risk. A diversified portfolio may help reduce the impact of market volatility and improve long-term investment outcomes.
Review whether your portfolio is diversified across:
Asset Classes
Spreading investments across equities, fixed income, property and alternatives reduces concentration risk in any single category.
Industry Sectors
Exposure across different sectors means a downturn in one industry is less likely to significantly impact the overall portfolio.
Geographic Regions
International diversification can provide exposure to different economic cycles and growth opportunities beyond Australia.
Investment Managers & Styles
Different managers and investment styles can perform differently across market cycles, adding another layer of diversification.
Explore Financial Year-End Tax Planning Opportunities
The end of the financial year often presents valuable tax planning opportunities. Professional advice may help ensure any strategy aligns with your broader financial objectives and current legislation.
Potential strategies may include:
- Tax-loss harvesting
- Reviewing capital gains positions
- Maximising concessional super contributions
- Making non-concessional contributions
- Charitable donations
- Reviewing investment structures
Review Liquidity and Emergency Funds
Strong financial fitness requires more than investment growth. Having sufficient liquidity can provide flexibility during periods of market uncertainty and reduce the need to sell investments at inopportune times.
Consider whether you have:
- Adequate emergency savings
- Access to liquidity if required
- Appropriate insurance coverage
- Cash reserves for upcoming expenses
Revisit Your Financial Goals
Life circumstances evolve, and so should your financial plan. Financial year-end is a great opportunity to ensure your investment strategy remains aligned with your goals — a key component of long-term financial success.
Goals Worth Revisiting
- Retirement planning
- Wealth accumulation
- Education funding
- Property acquisition
- Estate planning
- Wealth transfer strategies
Your Financial Fitness Checklist
Use this interactive checklist to work through your financial year-end review. Click each item as you complete it.
Prepare for the New Financial Year
A proactive financial year-end review can help you enter the new financial year with greater confidence and clarity. Small adjustments made today may have a significant impact on your long-term financial outcomes.
By regularly reviewing your assets, portfolio allocation, and overall financial strategy, you can remain focused on achieving your goals while managing risk effectively. Financial fitness is not achieved through a single decision but through ongoing review and disciplined action.
Frequently Asked Questions
Common questions about financial year-end reviews, portfolio rebalancing and maintaining your financial fitness.
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Financial year-end provides a natural checkpoint to assess investment performance, review asset allocation, consider tax planning opportunities, and ensure your portfolio remains aligned with your financial goals.
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Many investors review allocations annually, although some portfolios may require more frequent monitoring depending on market movements and personal circumstances.
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Portfolio drift occurs when market performance causes your asset allocation to move away from its original targets. Rebalancing can help restore your preferred risk profile.
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A comprehensive review should include your assets, liabilities, net worth, portfolio allocation, diversification, tax position, insurance coverage, emergency reserves, and financial goals.
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Regular reviews can help identify risks, maintain portfolio discipline, optimise tax outcomes, and keep your investment strategy aligned with your long-term objectives.
This blog post is for general information only and does not consider your personal circumstances, financial needs, or objectives. You should read the Product Disclosure Statement carefully before investing. Past performance is not a reliable indicator of future results. Investments carry risks including possible loss of capital. No guarantee is made regarding the repayment of capital or the payment of income. As with all investments, returns are subject to market conditions and the performance of the underlying assets. This rate of return is subject to the performance of our related entity, Skyring Capital Pty Ltd and/or Skyring Securities Pty Ltd.
You should consider whether the investments are suitable for you or seek personal advice from a licensed financial planner before making an investment decision. To invest in this Offer, investors should obtain and read the PDS, SPDS and TMD before making an investment decision. TMD, SPDS and PDS for this product are available from our website or by calling 1300 73 72 74 or requesting one from your Financial Advisor. Investments may only be made by completing the application form attached to the Product Disclosure Statement or via our online application service.
Skyring Asset Management Limited ACN 156 533 041 holds Australian Financial Services License (AFSL) 422902. Skyring has registered the Skyring Fixed Income Fund ARSN 622 775 464 and the Skyring Platinum Fixed Income Fund ARSN 646 317 982 with the Australian Securities and Investments Commission (ASIC). Skyring Asset Management Limited ACN 156 533 041 AFSL 422902 is the issuer and manager of both funds. Withdrawal rights are subject to liquidity and may be delayed or suspended. See PDS and SPDS for more information.
Skyring's address is Level 2, 2 Gardner Close, Milton, QLD, 4064. Reply-paid postal address: Reply Paid 88076, Kenmore, QLD 4069. Telephone: 1300 73 72 74. Email: investor@skyring.com.au.
