Why Your Financial Plan Needs an Annual Review

A financial plan that is not regularly reviewed gradually becomes detached from reality. Your life changes — employment, family, residence, health, financial obligations — and the tax and regulatory environment changes around you. A plan built on last year's facts, applied to this year's situation, may no longer be directing your resources where they need to go.

For internationally mobile individuals, the case for a rigorous annual review is particularly strong. Cross-border tax rules change, treaty positions evolve, and the simple act of moving countries can make a previously appropriate structure suddenly inefficient or non-compliant. The annual review is the mechanism that keeps the plan aligned with the life.

What a thorough annual review should cover

1. Goals and life circumstances

Every financial plan is built on a foundation of stated goals. The annual review begins by asking whether those goals are still correct.

Common goal changes:

• A planned move to a different country (earlier or later than previously assumed)
• Children finishing school (significant cash flow change)
• A business exit or sale of a significant asset
• A change in relationship status
• An inheritance, gift, or other unexpected wealth event
• A health change affecting long-term planning assumptions

Goals that have changed need a plan that has changed too. The review is the moment to explicitly revisit these assumptions rather than allow them to silently become outdated.

2. Income and cash flow

A review of income — current earnings, investment income, rental income, pension income — ensures the plan's projections remain grounded. For internationally mobile clients, this should also cover:

• Currency of income and whether the income-liability currency match is still appropriate
• Any changes to employment terms or bonus structure
• Business income changes and their impact on pension contributions or investment capacity
• Planned changes (such as retirement or a career transition) that will alter the income picture

Cash flow modelling — projecting income and expenditure over the medium and long term — is the technical basis for financial planning. The annual review is the time to update the model with current figures.

3. Investment portfolio review

Portfolio performance should be reviewed against the agreed benchmark, net of fees. The review should cover:

Absolute performance: how has the portfolio performed in sterling (or the reference currency) terms?

Relative performance: how has it performed against the benchmark? Consistent material underperformance relative to benchmark is a signal that the investment approach needs examination.

Risk realised: has the portfolio's volatility been as expected? Has the maximum drawdown (the peak-to-trough decline) been within acceptable bounds for your stated risk profile?

Asset allocation drift: has the asset allocation drifted from target? If equity markets have risen strongly, an equity overweight may have developed. The review is the opportunity to consider rebalancing.

Cost review: are the total all-in costs still competitive and proportionate to the service received? As portfolios grow, clients may qualify for lower fee tiers.

4. Risk profile and capacity for loss

Risk profiles are not permanent. Changes in circumstances — a new dependent, approaching retirement, a health diagnosis, a significant market loss that revealed more anxiety than expected — can mean the original risk profile is no longer appropriate.

The annual review should include an explicit reconfirmation (or updating) of risk attitude and capacity for loss. A risk profile set five years ago at age 45 may not be appropriate for the same person at 50, particularly if retirement is now a realistic near-term prospect.

5. Pension and retirement planning

For internationally mobile clients, pension planning requires particular attention:

• UK pension position: are contributions appropriate given your country of residence and the rules applicable? Has the annual allowance position been reviewed?
• SIPP vs QROPS: has your situation changed in ways that might make a QROPS transfer worth reconsidering, or vice versa?
• Retirement projections: is the projected retirement income still on track? Has a shortfall or surplus developed that needs addressing?
• State pension: if you are paying National Insurance contributions voluntarily (as a non-resident making Class 2 or 3 contributions), is this still appropriate?

6. Insurance adequacy

Insurance needs change with life circumstances. The annual review should cover:

• Life assurance: is the sum assured still appropriate given outstanding debts, dependants' needs, and IHT planning objectives?
• Critical illness and income protection: do existing policies remain appropriate given income levels and benefit periods?
• International health insurance: is the cover appropriate for your country of residence, and does it include adequate repatriation and evacuation cover?
• General insurance: does property and contents insurance cover international assets correctly?

7. Estate planning documents

Estate planning documents go stale. The annual review should confirm:

• Wills: are they current? Have life events (marriage, divorce, birth of children, death of executors) made them outdated or potentially revocable?
• Lasting Powers of Attorney (LPAs): are they in place for property/financial affairs and health/welfare? For internationally mobile clients, local equivalents (such as a healthcare proxy or durable power of attorney in the country of residence) may also be needed.
• Beneficiary nominations: are pension death benefit nominations, offshore bond beneficiary nominations, and life insurance nominations current and reflecting current intentions?
• Trust documents: if you are a settlor or trustee of a trust, is the trust still operating as intended? Are TRS registration obligations up to date?

8. Tax position review

For internationally mobile clients, the tax review at the annual meeting should cover:

• Current residence and domicile status — has anything changed?
• UK self-assessment filing: is a UK tax return required, and is it being filed correctly?
• Local tax compliance in country of residence
• Any specific tax events (large disposal, pension drawdown commencement, bond encashment) anticipated in the coming year that need planning

Trigger events: when not to wait for the annual review

Some changes are significant enough to warrant an immediate unscheduled review rather than waiting for the next annual meeting:

• Change of country of residence (tax year-end implications, new treaty analysis)
• Marriage or divorce (wills, beneficiary nominations, pension death benefits)
• Birth or adoption of a child
• Receipt of a significant inheritance
• A material change in employment (redundancy, business sale, senior appointment)
• A significant health diagnosis (life assurance, power of attorney urgency)
• A major market dislocation that has materially changed portfolio values

A good adviser will proactively contact clients when market events or regulatory changes are material. Clients should proactively contact their adviser when personal circumstances change.

Preparing for a review meeting

To get maximum value from a review meeting:

1. Review the previous year's action points — were they all implemented?
2. Note any life or financial changes since the last meeting
3. Read the pre-meeting report or statement your adviser should have provided
4. Prepare any questions about your portfolio, tax position, or planning
5. Consider what the next 12 months might bring — planned moves, large expenditures, career changes

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This article is for general information only and does not constitute financial, tax, or legal advice. The specific content of a financial plan review depends on individual circumstances. Seek ongoing advice from a qualified international financial adviser.

How Global Investments can help

Global Investments conducts structured annual reviews for all wealth management clients, covering the full range of planning topics described in this guide. Reviews are followed up with a written action plan and confirmation of any changes made to the portfolio or financial plan. We also provide an unscheduled review whenever a trigger event requires it. Contact our team to arrange a review, or explore our full range of financial planning guides.