3 important year-end financial planning strategies

Somehow we blinked and we’re in the fourth quarter of 2016. As the end of the year and holiday season approaches, it’s the perfect time to do some year-end financial planning. There are countless tasks that I could write about; however, I’ll provide three quick areas you can tackle to make sure you are setting yourself up for 2017 properly. Please remember to consult with your wealth advisor to ensure you’re covering all of the bases for your personal situation.

 1. Retirement and taxes

• If cash flow permits, attempt to maximize your 401(k) and/or IRA contributions before year-end. This would include any catch-up contributions if you’re over age 50.
• If you are over 70 ?, make sure that you take your required minimum distributions (RMDs) from your IRA accounts if you haven’t already.
• Take a look at your realized gains and losses in any non-qualified investment account (like a brokerage account) to see about harvesting capital gains if you have capital losses. Along with that, make sure you have all the proper cost basis information on any realized gains/losses.
• Consult your tax preparer and/or wealth advisor to inquire about any additional tax saving strategies before the end of the year.

2. Cash flow and budgeting

• Review your income and expenses year-to-date. Have you stayed within the budget that you have set, while maintaining your lifestyle you want? If not, what can you tweak for next year?
• Set goals. Think what you want to achieve in 2017 from a savings or debt reduction perspective. Also set goals that you would like to achieve over the next three, five and 10 years. Write these down to hold yourself accountable.

3. Insurance and estate planning

• Examine your current health insurance coverage. While it’s impossible to predict what health issues you may (or hopefully may not) have for the year, you can make the most well-informed decision on your health insurance coverage for the next 12 months when your employer’s open enrollment occurs.
• Consider costs. Take a look at your existing life and disability insurance policies and make sure that the need for those policies is still in place. There is no sense in paying premiums for unnecessary policies.
• Do you have a will, most importantly, and has it been updated in the last five years? If the answer is no to either, speak with an estate planning attorney or reach out to your wealth advisor to be connected to one.

Someone once said, “Failing to plan is planning to fail.” Review these strategies and then talk to your wealth advisor about your goals and priorities to set yourself up for a prosperous 2017.