As the year draws to a close, you may already be looking ahead, but don’t close out this chapter just yet. In order to set the stage for a prosperous 2024, you may need to check these year-end financial tips off your list first. So, as you think about getting proactive with your finances for the new year, commit to these intentional year-end actions, too. Read on for tasks to tackle and action steps to help you get started.
1. Review Your Financial Goals
Start by revisiting the financial goals you set for 2023. Celebrate your achievements and take note of any goals that remain unmet. Reflect on the reasons behind the unmet goals without judging yourself too harshly and consider whether they are still relevant. Adjust or set new financial goals for 2024 based on your current priorities and aspirations. It may help you to think in terms of short-term goals, mid-term goals, and long-term goals as you plan.
Year-End Financial Tips Action Step: Evaluate your short-term and long-term goals, such as saving for a major purchase, reducing debt, or planning for retirement. Ensure that your financial objectives align with your life’s evolving circumstances, and with your personal values.
2. Maximize Retirement Contributions
If you haven’t maximized your contributions to tax-advantaged retirement accounts, now is the time to consider doing so. Contributions to accounts like a 401(k) or IRA can reduce your taxable income and increase your savings for retirement. If you are 50 or older, consider making catch-up contributions to accelerate your retirement savings.
Year-End Financial Tips Action Step: If you’re still working, consult with your employer’s HR department or financial advisor to assess your retirement account contributions and explore opportunities to increase them.
3. Tax-Efficient Investment Strategies
Year-end presents an excellent opportunity to review your investment portfolio and consider tax-efficient strategies. Tax-loss harvesting, for example, involves selling investments that have declined in value to offset capital gains, potentially reducing your tax liability.
Year-End Financial Tips Action Step: Work with a financial advisor to explore tax-efficient investment strategies and ensure that your portfolio aligns with your long-term financial goals.
4. Charitable Giving
If you plan to make charitable donations, doing so before the end of the year can offer potential tax benefits. Ensure that your contributions are made to IRS-qualified organizations and keep records of your donations for tax purposes.
Year-End Financial Tips Action Step: Explore different ways to give, such as cash donations, appreciated securities, or contributing to donor-advised funds.
5. Budget and Debt Management
Having a budget – and sticking to it – is a foundational personal finance habit. If you’re not currently using one, let this be your sign to start! If you do have a budget in place, review it now to ensure that it aligns with your financial goals. Manage your debt effectively by exploring strategies to reduce high-interest debt and improve your overall financial health.
Year-End Financial Tips Action Step: If you’re battling debt, consider setting a debt reduction plan for 2024. Prioritize tackling high-interest debts and finding ways to cut unnecessary expenses from your budget.
6. Investment Diversification
Diversification is a key element of sound financial planning. Review your investment portfolio to ensure it remains diversified and aligned with your risk tolerance. Rebalancing your portfolio may be necessary to maintain a balanced risk-reward ratio.
Year-End Financial Tips Action Step: Consult with a financial advisor to analyze your investment portfolio and make any necessary adjustments to ensure diversification and a strong foundation as you enter the new year.
7. Estate Planning
Estate planning is essential for preserving your legacy and protecting your loved ones. Review your will, trusts, and estate documents to ensure they reflect your current wishes.
Year-End Financial Tips Action Step: If you haven’t established an estate plan, or if it’s been a while since you last updated it, consult with an estate planning attorney and financial advisor to create or revise your plan. This should include updating account beneficiaries to reflect any life changes or priority changes over the past year.
Want More Year-End Financial Tips You Can Use?
As we bid farewell to 2023, it’s essential to make use of the year-end financial tips that make sense for your personal financial circumstances. By actively managing your money and making well-informed decisions, you’re setting the stage for a prosperous 2024 and beyond. Remember that your financial well-being is an ongoing journey, and taking the right steps today can lead to a brighter and more financially secure future.
Would you like additional year-end financial guidance personalized to your needs? We can help! At Cash Financial, we take your unique needs and goals into account and help you make every financial decision count. Contact us today to learn more about our services!
