Expertise Beyond the Numbers

Year-End Financial Planning: Making a List, Checking it Twice!

The following blog post offers year-end financial planning tips.  

It’s that time of year again where the mad rush is upon us. With holiday events, family commitments, and workloads keeping us frantically running around, it is easy to forget about tying up year-end finances. Given this, we thought it would be the perfect time to share a to-do list of some important end-of-the-year housekeeping items to get you prepared, and stay one step ahead financially for the New Year.

  1. Review Your Spending, Plan Your 2015 Budget

The end of the year is the perfect time to reflect on your 2014 spending and develop a budget that will allow you to save a certain amount each month as you head into 2015. Consider having a portion of your paycheck directly deposited in your savings account and the rest in your checking account. It does not have to be a large amount — anything is a good start. Automating this process will help you maintain a regular savings plan.

  1. Meet With Your Financial Advisor for a Portfolio Analysis

Now is a good time to reassess your investment strategies with your advisor. How did the investments perform? Did your portfolio grow to keep pace with your financial objectives? Reassessing your portfolio will help you remain on track with your retirement goals. If you have not started planning at all, now is the time!

  1. Max Out Your IRA and/or Roth IRA Contributions

Traditional and Roth IRAs allow individuals younger than 50 to contribute up to $5,500 each year and individuals older than 50 to contribute $6,500. Besides offering tax-deferred growth, an IRA provides you with the option to contribute for 2014 up until April 15, 2015. While contributions to Roth IRAs are not tax deductible, the funds grow tax free and remain so, even upon withdrawal as long as your money has been invested for at least five years.

  1. Consider Funding a 529 Plan

A 529 plan is a great vehicle for accumulating college or higher education savings for your children’s future. It is fairly straightforward. You contribute money into investments within the plan, the money grows tax-free, and when your child is ready for school, you sell the investments and the money can pay for tuition, room and board, and book fees. On top of this, many states offer a state income tax deduction if you contribute to a 529 plan sponsored by that specific state.

While doing your financial planning during the holiday rush may be challenging, this is exactly the right time to get organized. By taking the time to “make your list and check it twice,” you will be in a much better financial position heading into 2015.

And isn’t that what we all want … some financial peace of mind during the chaos of the holidays.

If you are also dealing with the mad holiday rush, and want to get a handle on your year-end finances, we welcome you to contact Amanda Wooddell Wilhelm, a Manager at SC&H Group, here.