8 Money Tasks to Do Before the End of the Year
Introduction
As the year comes to a close, it's essential to take stock of your financial situation and make strategic moves to set yourself up for success in the coming year. Here are eight crucial money tasks to tackle before the year ends.
1. Maximize Retirement Contributions
Maximizing your retirement savings is a straightforward way to ensure financial independence later in life. For 2023, you can contribute up to $22,500 to your 401(k) until December 31 and $6,500 to your IRA until April 15, 2024. If you're over 50, take advantage of catch-up contributions.
Image Description: Infographic showing the limits for 401(k) and IRA contributions.
2. Use Up Remaining FSA Money
Flexible Spending Accounts (FSA) are a great way to use pre-tax dollars for medical expenses, but unused funds typically expire at the end of the year. Ensure you spend any remaining balance on eligible expenses such as co-pays, prescriptions, or medical supplies.
Image Description: Infographic showing how to utilize remaining FSA funds before they expire.
3. Revisit Your Budget
Take a close look at your 2023 budget to analyze your spending habits and identify areas for improvement. Assess whether you met your financial goals and make adjustments for 2024. Consider cutting unnecessary expenses and increasing savings.
Image Description: Infographic illustrating the process of reviewing and adjusting your budget.
4. Contribute Extra to a 529 Plan
If you have a 529 college savings plan for your child or grandchild, try to maximize contributions before year-end. Contributions grow tax-free, and many states offer tax deductions for 529 plan contributions.
Image Description: Infographic showing the benefits of contributing to a 529 plan for education savings.
5. Make Last-Minute Charitable Contributions
Donations to qualified charities are tax-deductible and can help reduce your 2023 tax bill. Ensure you donate by December 31 and keep receipts for tax purposes. Be cautious of charity scams, especially during the holiday season.
Image Description: Infographic explaining the tax benefits of making charitable contributions.
6. Check Your Credit Report
Check your credit report for free from the three major bureaus at AnnualCreditReport.com. Review your report for any errors or inaccuracies and dispute them to maintain a healthy credit score.
Image Description: Infographic showing the steps to check and correct your credit report.
7. Plan for Your Year-End Bonus
If you receive a year-end bonus, decide how to use it wisely. Consider paying off debt, boosting your emergency fund, or contributing to retirement accounts. Plan your bonus spending to avoid impulsive purchases.
Image Description: Infographic showing smart ways to utilize a year-end bonus.
8. Take Advantage of Credit Card Rewards
Review your credit card rewards and use any that are due to expire. Redeem points or cash back to maximize the benefits and avoid losing out on rewards you've earned.
Image Description: Infographic explaining how to take advantage of expiring credit card rewards.
