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How to plan for year end

How to plan for year end

| December 10, 2013
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Financial Planning

"You may delay but time will not." Benjamin Franklin

At the end of the year looking back, whether smooth sailing or a wild ride, there is plenty to look at to close out the year. Take a look at a brief list of items we should look at to close out every year to make sure you’re up-to-date.

  • Adjust tax withholding – Changes in income, withholding too much/too little is very common. Getting no tax bill/no refund means you’re handling our taxes efficiently.
  • Contribute to 401k/retirement plans – Qualified plans typically can be contributed to until the end of the year. You can reduce our taxes and increase our retirement fund at this time.
  • Use calendar year benefits – Many benefits are based on the calendar year such as eye exams, flexible spending accounts and teeth cleaning. Be sure to use these before they expire.
  • Donate to charity – Charitable donations are considered for taxes in the year donated. Not only can this be personally fulfilling, but it can help on April 15th.
  • Review/rebalance investments – One of the keys to a strong strategic investment allocation is sticking to that allocation in the long run. The more divergent the year, the more important it is to review/rebalance.
  • Review beneficiaries – Year end is a good time to make sure you have the right beneficiaries in mind, doing every year will help make sure you don’t miss someone.
  • Review savings – The holidays can wreak havoc on your savings. By making sure savings are healthy after the holidays, you can carry through a proper balance all year long. Having too much in savings on the other hand means you may be giving up a lot of opportunity by not investing enough.
  • Review life insurance – If you have had changes in income, insurable need, changes in beneficiaries, etc. Year end is a great time to make sure you’re properly insured and that those policies are stable.

Year-end inevitably brings up a lot of questions about investments and financial plans. Keep a pad of paper and pen nearby. Write down questions that come up and be sure to bring them up in your next financial planning conversation. Especially if that financial planner is me!

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