The end of the year is less than two weeks away. Now is the time to plan your year end activities so you can make the most of your financial planning and tax strategies. Here is a list of a few things you should do by December 31st.
Spend your Flexible Savings Account
If you don't use it, you lose it! Each year you are allowed to contribute to a Flexible Spending Account up to $2,650. The benefit you get from these contributions is you don't pay taxes on these funds and you can use the funds to pay for medical or dental expenses. Many people take this opportunity to upgrade their prescription eyeglass frames and lens. So take this chance to purchase all the health related items by the end of the year so you don't lose the benefit.
Maximize On Your 401(k) , 403(b), or 457 Employer
Many employers offer a generous match, which is based on your contributions. If your employer matches your contributions, you would be foolish to forego this match. It is essentially free money. Don’t think twice, maximize on your contributions!
Maximize On Your Traditional and Roth IRA Contributions
Contributing to your Traditional IRA or Roth IRA each year should be an important part of your retirement strategy. This allows you to save for your retirement with preferred tax treatment on your investments. Not only is this the cornerstone of a solid financial plan, but it can also provide you with tax benefits today.
Just be aware there are limitations depending on type of income, AGI and whether you currently have an employer sponsored plan. Unsure if this applies to you? Give me a call and I'll be happy to discuss this further!
Review Your Investments
End of year planning is a good time to review your investments and update your family’s balance sheet. Update your valuations and compare these to your financial plan to make sure you are on track to meet your retirement goals.
Let's set up a time to discuss and review your investment portfolio and how it fits into your overall plan!