How you deal with these issues may be different, but in all cases these changing circumstances should not be ignored.

The only thing that is certain about your financial future is change. Many things will change as you go through life. The changes may be matters you can’t control, such as the inflation rate, interest rates, the tax code etc. or ones that you can control.

How you deal with these issues may be different, but in all cases these changing circumstances should not be ignored.

Let’s start with the easy stuff –  changes that you cannot control. Because you can’t control these, you are forced to deal with them as they arise or speculate about their arrival and the consequences of such changes.

A good example of this may be the presidential election. The pundits all came out with their market forecasts under a wide range of potential election outcomes. Very few called for rising U.S. equity markets under the scenario that actually played out. If you used your intuition and decided that moving to cash would be in the best long term interests of your portfolio –  you are probably feeling that you made a wrong move.

Another example is seen in the natural cycle of life. You cannot prevent your child from growing up or from driving a car –  but you can prepare yourself for the eventuality of their maturity and the ensuing issues that may accompany that and plan accordingly. For example, as they head off to college this year, make sure that you let your insurance agent know that the car is headed to XY University and no longer garaged in your home.

You can also lay down rules for your child to further mitigate possible risks. One such mitigation may be to ask your child to not allow friends to borrow the car. While your college buddies may be fully covered with whatever policy their parents have in place, why bother even exposing yourself to that risk. Similarly, consider adding renter’s coverage for your child while at school to protect against theft of other damage to personal property.

At any point, there are risks to which we may be exposed that may or may not be properly addressed. The most effective way to avoid having something material fall through the cracks and derailing your plan is to keep your measurements close together. Using the example of your child at college, the best way to avoid unforeseen problems is to evaluate the situation each and every year. Review the insurance policy as the new one arrives, evaluate the circumstances and see if what you did last year is still effective.

For matters out of your control the process is similar. If you’re long term forecast calls for 4 percent inflation and a 6 percent rate of return on investments, and actual results vary, your destination at retirement may be very different than you had planned. Measuring these matters annually and altering the plan or the tactics needed to get your plan back on track could save your future.