Important End-Of-Year Financial Tasks
By Lis McNealey Davies, CDFA®
Owner, Financial Advisor
Once the holiday season arrives, it can feel as if everything speeds up and slows down at the same moment. Things like tackling your financial to-dos can often take a back seat to your holiday commitments, end-of-year work to-dos, and treasured family time. But dedicating an hour or two to tackle these end-of-year financial tasks may help improve your financial outlook for the rest of the year and for the following year as well.
Here are four important tasks to consider.
Review your budget and spending habits
What did your spending look like over the course of the year? This isn’t a question to make you feel bad, it is just a way to start looking at the facts. Once we know the facts then we can decide on how to tie those into our financial goals. Did you stick to your budget? These important questions can help you take a good look at your financial situation and see if you need to adjust your spending in the future.
Evaluate how gifts could impact your tax burden
If you are over the age of 70.5, and have an IRA, you can gift through a Qualified Charitable Distribution. Otherwise you can gift to your favorite charity or charities and possibly receive a tax benefit to offset any gains.
Review contributions to your retirement plans
Make sure you are contributing the most you can to your employer’s retirement plan. Every dollar you contribute decreases the amount of income you are taxed on for the calendar year. Plus, you are saving for your retirement.
Realized Gain and Loss
Talk to your Financial Advisor to learn what, if any, realized gains or losses or capital gains distributions you have in your taxable accounts. You can use losses or gains within a taxable account to offset other liabilities if these transactions are completed by December 31 of that given calendar year.
Our team is here to assist you with your financial needs. Give us a call if we can help you tackle any of these items.
Lis McNealey Davies is president of The Arlington Group Investment Consulting. A true leader in the female focused financial advisory niche, Lis builds upon the group’s strong foundation and core offerings to drive growth and champion the group as an emerging advisory company in the divorce, widowed and life transition niches. As a previous divorcee and mom to three wonderful daughters, Lis understands firsthand the importance of financial confidence.
The use of the CDFA® designation does not permit Wells Fargo Advisors or its Financial Advisors to provide legal advice, nor is it meant to imply that the firm or its associates are acting as experts in this field. Wells Fargo Advisors Financial Network is not a tax or legal advisor. Be sure to consult with your own tax and legal advisors before taking any action that may have tax or legal consequences.
Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. The Arlington Group Investment Consulting, LLC is a separate entity from WFAFN.