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End - of - year money moves

End - of - year money moves

November 28, 2023

End-of-year money moves

As the temperature starts to dip and the calendar inches closer to another year, now may be the
time to consider some year-end financial decisions. Thinking about these choices today could
set you up for a better year ahead.

Itemizing deductions? Gather your receipts

First, you should consider whether you’ll be itemizing your deductions or taking the standard deduction. The standard deduction for 2023 is $13,850 (or $27,700 for joint filers), or, you can itemize your deductions if you think that amount will be greater. If you opt to itemize, start gathering your receipts now. Tax day might not be until next April, but you’re better off preparing for your itemized deductions now so that when tax season rolls around, you are ready.

Make a gift, or two

The holiday season can be a great time to give to your favorite charity, both for those in need and to benefit your personal finances. If you give to a qualified charity, you can likely use your donation as a tax deduction. This applies even to non-monetary gifts, like clothing and home goods. Just make sure to get a receipt for your donation to help make sure you account for all of your gift deductions.

Take a look at your estate

You probably thought a lot about your estate and its structure when you were setting it up, but that doesn’t mean you should completely forget about it. Taking a yearly look at your estate can help you make sure all of your information is up to date and you’re gaining the most benefit from its structure.

     Consider looking at your:

  • Beneficiaries-update to include new beneficiaries you’d like to add
  • Annual gift exclusion-gifting up to the annual exclusion amount can help reduce your taxable estate
  • Will -review to make sure all of your will documentation is up to date

Get in that last doctor’s Visit

Many health insurance plans are tied to the calendar year. This means, if you’ve hit your deductible (or are close to it), you might find it more financially advantageous to get medical care done before the year ends. Once your deductible is reached, your insurance company will likely start paying more for your medical expenses. However, your deductible will likely reset in January, so it could make sense to squeeze in a procedure or doctor’s visit before the calendar turns to a new year.

Maximize retirement contributions

Whether you have an IRA, Roth IRA, 401(k), or other retirement account, consider taking full advantage of the potential tax incentives of your yearly contributions. If you have an IRA, you can contribute up to $6,500 for 2023 ($7,500 if you are above age 50), while up to $22,500 can be contributed to your 401(k) this year. Remember, there are still contribution restrictions for Roth retirement vehicles.

Prepare yourself for another great year

Now that 2023 is almost in the books, it’s time to start thinking about how you can make 2024 your best year ever. These year-end money moves can be your first step to starting the new year off on a good foot.

Learn More about how we can support your year-end financial moves, or reach out to us directly to Schedule a meeting or ask a question.