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Be Wise With Money

Finances in Focus: Your Year-End Checklist

checklist for year-end

Many people review their finances at the start of a new year. But why wait until then?

Reviewing them now – while you still have time to make adjustments – could save you money and stress.

More specifically, assessing your finances before the end of the year can:

  • Offer a snapshot of what you've earned, spent and saved.
  • Provide insight on where you stand on year-end deadlines.
  • Help you track progress against long-term goals.

Here's a checklist to help with your review.

8 to-dos for your annual financial review

Ticked checkbox1. Study your expenses.

Where did your money go? Making a list of all of your expenses can help you answer that question – and expose habits that could hurt your future.

Tip: Look closely at your monthly expenses. You may be able to save money by cutting back on services you don't use enough to justify their cost – such as cable TV or a gym membership.

2. Evaluate your savings goals.

Are you on track to hit the financial goals you set? Do you still need to, for example, build up your emergency savings fund?

Tip: Don't get discouraged if you haven't met your goals. Remember, a little can go a long way. And right now is always the best time to start.

3. Identify your year-end tax strategies.

Make sure you fully understand your tax situation. Have you earned investment dividends and interest? If so, it can affect how much tax you'll owe. And if you made money by selling an investment, that gain also may be taxable.

Tip: You might be able to offset your tax obligation by selling another investment at a loss or making charitable contributions. Thrivent Financial doesn't offer tax advice, so remember to consult with your tax advisor for more year-end strategies.

4. Review your retirement contributions.

If your financial situation allows, it's usually a good idea to maximize your retirement savings, particularly if you have individual retirement accounts.

If you didn't hit your year-end target, see if you can catch up in the first quarter of 2018.

Tip: If you can boost contributions to your IRAs by April 17, 2018, you can deduct part of the amount from your 2017 taxes.

5. Consider your charitable donations.

Helping those in need is the most important reason to give. But how you choose to pay for those donations also may cut your tax bill.

Tip: If you're 70½ or older, you typically must take a required minimum distribution (RMD) from your retirement accounts each year. If you donate some of that distribution directly to a charity, you may trim your tax bill.

6. Evaluate your flexible spending dollars.

If you've set aside pretax dollars in a flexible spending account for health care or child care, check your balance. Figure out how you'll use it up by the end of the plan year. And remember: If you don't use it, you generally lose it.

Tip: Use your 2017 flexible spending to estimate how much to set aside next year.

7. Inspect your insurance contracts.

Major life events such as marriage or a new baby can affect the amount and type of insurance you need. And if you're starting your first job or changing careers, make sure to consider disability income insurance.

Tip: Employer-provided life insurance may not always be the most affordable option. Don't be afraid to shop around – you could find a more cost-effective alternative to purchase on your own.

8. Prepare for next year.

Look over your objectives from the beginning of this year, and make any changes you need for the coming year.

Now is also a great time to contact your financial representative for help with planning for 2018 – and farther down the road.

DEADLINE: DEC. 31, 2017

You must complete the following items by the end of the year to count toward your finances for the current year:

  • Make charitable donations.
  • Contribute to your 401(k) or other workplace retirement plan.
  • Take required minimum distributions on retirement accounts.
  • Use flexible spending dollars, if your company does not have a grace period or carryover.
  • Sell investments at a loss to offset capital gains taxes on other investments.

This article was adapted for the Web from the September 2017 issue of Thrivent magazine. Thrivent magazine is free to all associate and benefit members. View the latest issue or become a member today to start receiving print or digital copies as a benefit of membership.


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