Year-End Financial Checklist

Jenny Handwerk |

Year-End Financial Checklist 


Organizing your money, taking full advantage of any tax breaks, and confirming that you're on pace to meet your objectives are good ideas as the year ends.

You should think about doing several things by December 31 to straighten up your finances, whether you're just starting in your profession and generating wealth, fine-tuning your future goals, or getting ready for retirement. You can get advice from a financial expert on how these actions can affect your financial situation.

In any event, you're prepared to start the new year with some fresh financial objectives. Before turning the calendar to the next one, you should finish a few things on this year's to-do list. By doing this, you'll be able to relax and concentrate on the upcoming year.


  • Review your financial plan.


Consider what and how much money you spent this year. Did you meet your family's financial goals, whether home improvements, a vacation, or increasing a loved one's college savings? Or did you put some on wait to focus on other priorities that arose throughout the year? Do you anticipate making any significant purchases in the coming year? Analyze what has changed in your life this year as well. Births, deaths, marriage, divorce, and retirement can all affect your finances and overall financial plan.


  • Review or update your beneficiary designations.


Update the beneficiaries on your bank accounts, retirement accounts, life insurance policies, and annuities as needed.  Have you married or had a child within the previous year? Perhaps a loved one has left your life due to a divorce or death. Choosing a beneficiary for your life insurance policy is a crucial decision. This is significant because beneficiaries precede those who are mentioned in a will.

To keep track of your beneficiaries, jot down their names and the date of any updates. Also, identify a contingent beneficiary in case your primary beneficiary dies. Your recipients can be individuals, charities, nonprofit organizations, or a mix. 


  • Offset capital gains with capital losses.

"Tax-loss harvesting" is a complicated term for a basic concept: selling stocks and funds that have depreciated to balance taxes on gains from sales of those that have appreciated. Whether you have investments outside of tax-favored retirement plans and have profited from selling any this year, investigate whether you may reduce your tax burden by selling some poor performers. Even if you haven't "realized" capital gains by selling winners, realized capital losses may be able to reduce your (taxable) ordinary income by up to $3,000.


  • Conduct a year-end tax review.


Although Tax Day is on April 15, starting planning beforehand is always a good idea. For example, have you gone through any significant life changes (marriage, babies, divorce, funerals, retirement, etc.) in the recent year that could impact your tax withholding status?

Based on your projected income for the coming year, will delaying or accelerating any bonuses, property sales, other taxable transactions, deductible expenses, charitable giving, and so on assist you financially? A financial chief officer can assist you in reviewing your alternatives.


  • Review your portfolio 


Check to see if your financial strategy is still appropriate for you. Have you lately inherited any money? Your work may be less secure than it was the previous year. Your investments and financial portfolio may need to be reviewed and adjusted as your life changes. Consult with your financial advisor to see how changes in your life have affected your total financial portfolio. For example, the stocks and bonds in your investing portfolio should be appropriate for your age and risk tolerance.

Your portfolio should include investing goals appropriate for your present stage of life. Your age, risk tolerance, tax status, and time horizon are all crucial considerations. Speak with a financial specialist about your specific situation.


  • Make sure you're adequately insured.


This year, have you added to your family? Have you recently purchased a home? Have you started a business? Your insurance coverage at the start of the year may need to be revised for your needs in the coming year.

Check to see if your life insurance policy protects your partner and children and that you have adequate liability coverage on your home and automobile; an umbrella liability policy may be required depending on your assets. You may also want additional coverage if you use your home or car for commercial purposes.


The most essential move you can make as the year ends is to consult with a financial professional to ensure your overall financial condition is in order. There is still time left in the year to act if necessary, but the clock is ticking. We encourage you to book a conversation with us if you want a year-end evaluation of your financial condition or if you have questions about the year-end strategy.