20 money moves to make before the end of the year
This financial checklist will help you meet all upcoming deadlines
With just a few months left until the end of the year, it’s time to squeeze in some last-minute retirement savings, revisit financial goals from the beginning of the year and update your insurance accounts, among other tasks. U.S. News reached out to financial planners about the action steps you should take now to make sure your money is in tiptop shape for the new year. Here are their suggestions:
1. Squeeze in more retirement savings.
When it comes to maxing out your 401(k), you still have time to increase your savings rate into your employer-sponsored retirement accounts before the end of the year. For 2015, those under age 50 can contribute up to the maximum of $18,000, which is an increase of $500 over last year. For those age 50 and over, the maximum is an additional $6,000. Mary Beth Storjohann, certified financial planner in the San Diego area and founder of Workable Wealth, recommends checking your account to see how close you are to the maximum and to increase contributions accordingly. Another option, she says, is to contribute to a Roth IRA, which has a maximum of $5,500 for the year (and an extra $1,000 for those age 50 and over). “If you can’t do the maximum, work to put as much as you can away,” she says.
2. Don’t forget to check your accounts.
Daniel Wrenne, a certified financial planner and founder of Wrenne Financial Planning in Lexington, Kentucky, says people often forget to check in on their retirement accounts, which are often housed in separate financial institutions than checking and savings accounts used for daily expenses. He points out that you might even need to pull out a calculator to make sure you’re hitting your maximum contribution limits. “You’d think there’d be a box to check that says, ‘Max it out,’ but it requires a little bit of planning,” he says. Another risk is maxing out too early in the year, which in some cases can mean earning less of your company’s matching plan. He recommends a slow and steady approach, contributing the same percentage from each paycheck throughout the year.continue reading »