Quick Year-End Financial & Insurance Planning Tips

04 Oct
2017 Financial Insurance Planning Tips

2017 Financial Insurance Planning Tips

It’s getting to the end of the year, which means holiday parties, shorter days and depending on where you live, plenty of cold and snow. It also means that it’s time to review your financial situation before year-end and the start of the tax season.

Take a few minutes or hours over the next month and examine your financial and insurance holdings to make sure you are set for the end of the year as well as any tax liabilities that may be coming your way.

Here are just a few financial items to check in the final months of 2017:

Consult Your 2017 Plan: Assuming you had a 2017 financial plan, its time to pull it out and evaluate your progress this year. If you have a number of financial goals you haven’t accomplished yet, its time to roll up your sleeves and crank them out. Any goals that are still valid and uncompleted at the end of the year need to be rolled over to 2018.

Check Asset Allocation: As stock prices have increased your portfolio allocation may have bumped up the percentage of your portfolio that is in stocks. If you find that you are holding more risk than your comfortable with, it may be time to look at reallocating some of your assets. As always, be sure to take into consideration the tax implications of any reallocations or sales.

Review Your Budget: Break out the spreadsheets and take a look at your monthly and yearly budget. Dig down into the numbers and see if there is anywhere you can cut back on spending and add to your savings account. Is there any extra savings that can be added to your long-term retirement accounts?

401K and IRA Contributions: Calculate your 401K and IRA contributions to make sure that you have maximized the allowable contributions. Look for tax deductions and make sure you are maximizing you employer-matching contributions.

Review Your Charitable Donations: Charitable donations are an excellent way to reduce your taxable income while also helping out your favorite organizations. You can give cash or appreciated securities, which allows you to deduct the market value from your income while also avoiding capital gains tax. If you haven’t made any charitable donations this year, now is the time.

Tax Loss Harvest: While this is has been a pretty good year for the market, not every stock can be a winner so if you have some losers in your portfolio it may be time to sell them to take the tax loss and offset your other gains. The IRS limits the deduction to $3,000 per year but any unused losses can be carried forward.

Check In With Your Financial Advisors: Talk with your financial advisor and tax experts to see if they have strategies to help lower your tax bill for this year. As we enter the fourth quarter, time is running short so make sure you contact them soon.

Verify Your Tax Withholding: Review how much tax is being withheld from your paycheck and calculate whether it is enough to cover your tax liability for this year. It is possible that you may be withholding too much or you may need to up your withholding. Now is the time to look at the numbers and calculate where you are at for the year.

Flexible Savings Account: Assuming you have a flexible savings account, check your balance and determine whether or not you have any unspent money in it. Some plans require that the money be spent within the year while others allow the money to rollover to the following year. If you do have unspent money, consider a new pair of glasses, contacts or a visit to the doctor for a checkup. Losing the money is never a good idea.

Mutual Fund Distributions: Check with any mutual funds you own in regards to distributions or gains. Attempt to offset those gains with any losses. If you are lucky enough to have avoided any losses, make sure you have money set aside to cover the related taxes.

Homeowners Insurance: Finally, review your homeowners insurance coverage. Are you carrying the proper coverage in the right amounts? If your home has increased in value or building costs in your area have gone up, you may need to up coverage levels. Consider your liability risks and purchase an umbrella policy if necessary. Also, make sure that you have an updated home inventory stored offsite or in the cloud.

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