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5 End-of-Year Money Moves

5 End-of-Year Money Moves

December 18, 2023

As we start winding down 2023, there are a few financial tasks that might need your attention before you pour that eggnog. Don't worry; this isn't about crunching numbers or deciphering complex financial jargon. It’s just a few things to get you started on the right track for the new year.

 1. Review Your Budget and Set New Goals

Picture this: you set some financial goals at the beginning of the year, and life happened. Maybe you snagged that irresistible mid-year sale, or perhaps you faced unexpected expenses. No judgment here! Now is the perfect time to dust off that budget and take a good look at how well you stuck to it. Did you meet your goals, or did a few extra zeros sneak their way into your spending?

Once you've reviewed your current financial landscape, it's time to set new goals for the upcoming year. Whether it's saving for a dream vacation, paying off lingering debts, or boosting your emergency fund, establishing clear objectives can help you stay on track and make your financial dreams a reality.

 2. Maximize Retirement Contributions

Ah, retirement—the golden years we all look forward to. One way to make those years truly golden is by maximizing your retirement contributions. If you have a 401(k) or similar employer-sponsored plan, check if you've hit the contribution limit for the year. If not, consider contributing a little extra before the clock strikes midnight on December 31st.

Additionally, if you have an Individual Retirement Account (IRA), ensure that you're on track with your contributions. Contributing to your retirement accounts not only helps to secure your financial future but may also offer some sweet tax benefits. It's like giving your future self a high-five.

 3. Tax Planning: Harvest Those Losses

Taxes, the unavoidable chore of adulthood. But fear not! There's a silver lining, especially when it comes to investment losses. If you've experienced losses in your investment portfolio this year, consider tax-loss harvesting. This strategy involves selling investments at a loss to offset gains and help reduce your overall tax liability.

Before you dive into the world of tax-loss harvesting, consult with a tax professional to ensure you're making informed decisions. It's like having a personal financial guru to guide you through the maze of tax codes and regulations. Your future self will thank you.

 4. Check Your Credit Report

Your credit score is like your financial report card—it influences everything from loan approvals to interest rates. Take a moment to pull your credit report and review it for any discrepancies or potential issues. Ensure that all your accounts are accurate and that there are no unauthorized entries.

If you spot any red flags, address them promptly to avoid any unpleasant surprises down the road. A clean credit report can open doors to better financial opportunities and lower interest rates, so it's well worth the effort.

 5. Use Your Flexible Spending Account (FSA) Dollars

If you have a Flexible Spending Account (FSA) for healthcare expenses, it's crucial to use up those remaining dollars before they vanish into thin air. Many FSAs operate on a use-it-or-lose-it policy, meaning any unspent funds could disappear when the new year arrives.

Schedule those overdue check-ups, stock up on prescription medications, or invest in eligible health-related items. Not only will you be taking care of your well-being, but you'll also be maximizing the benefits of your FSA. It's a win-win!

 

Here's to a financially fit new year—may it be filled with prosperity, wise money moves, and the occasional guilt-free splurge!