End of Year Money Moves
Please consult the appropriate professional regarding your individual circumstance.
- Review your financial goals for the year. Start with looking back at how 2019 was – did you have a budget? Did it work? What expenses will you have in the New Year?
- Do you have a plan in place to prepare for a catastrophic health situation?
- Once you cut out unnecessary expenses, start increasing your contributions to your retirement plans or traditional savings accounts.
- Yes, there are several things you can do. You may consider contributing as much as you can to those retirement and savings accounts. For example: The maximum 401k contribution this year is $19,000. By contributing to a retirement account, you could be setting yourself up for success in retirement AND could end up paying less in state and federal taxes now because your take home pay could be less.
- Don’t forget to take the required minimum distribution if you are 70 ½ from certain retirement accounts. If you don’t take the RMDs, you can be subject to a large penalty.
- Absolutely, you want to make sure your withholdings are correct. In 2017, the federal government changed withholding amounts. It caught a lot of people off guard last year. It’s a good idea to meet with your tax preparer or financial professional to make sure you aren’t going to have any big surprises come tax time.
- And even though the tax deadline is months away, it’s important to think about it now. Say for instance, you may decide to itemize deductions versus taking the standard deduction in 2020. You may want to increase donations this month to charitable organizations to maximize deductions.
- I would encourage everyone to set some financial goals for the year. It can be as simple as saving more money each month or paying off debt. Small changes really add up.
- If you have credit card debt, for instance, here are a couple tips: First, create a budget and look for places to cut spending. Get aggressive! You’re going to need all available funds to get rid of the debt.
- Second, try paying off the card with the smallest balance first. And, you can try and call credit card companies and try and negotiate for lower interest rates!
- Try and make realistic savings goals. Saving is a marathon and not a sprint!