End of Year Honey-Do List

End of Year Honey-Do List

Every year, I write a similar blog on end-of-year items you should be doing to keep your finances in check.  Keeping on the theme, I figure let’s rinse and repeat the items I personally do and suggest during the holiday lull.

401(k)-

For starters, if you have a 401(k) or any other employer-sponsored retirement plan, I recommend sneaking whatever you still can away.  Ideally, you would put in the IRS limit, although that is not always feasible depending on your income level.  That said, at the very least, do what you can to maximize your employer match dollars, aka FREE MONEY!

Charity–

There are some nuanced changes in charitable deductions next year that will impact those who are charitably inclined.  In any event, if you are considering making a charitable contribution, you still have until 12/31 to charge your donation or get something postmarked, regardless of when the charity receives the funds.  Remember it is always better to give than receive.

Insurance–

This is a great time of year to do an insurance audit.  For starters, do you have the appropriate amount of insurance for things like disability or life insurance?  Next, are there major gaps in your insurance needs, such as no long-term care insurance, or possibly need to purchase some critical insurance but have been dragging your feet?  Finally, are you paying too much for any of your coverage, especially when it comes to property and casualty insurance, as those premiums can change year over year?  A healthy insurance audit will make sure your biggest liabilities are appropriately covered.

Taxes–

If you haven’t already time to run a tax plan and get a hold of where you’ll stand from a tax standpoint.  Check your non-retirement investment account tax liabilities or projections.  Get an overall sense of your deductions, withholdings, and estimated tax exposure. I find being prepared here can prevent you from having an unpleasant surprise as tax deadlines approach.

Savings–

How are you feeling about your current savings accounts and amounts (love it when things rhyme)?  This is a great time of year to make sure you are happy with the savings rate in your cash accounts.  Do you have a proper 3-6 month savings account readily available?  Do you have money saved for those predictable larger expenses you know are on the horizon?  I don’t like surprises when it comes to my finances, and the best way to prevent that is being in a position where the “surprises” are already accounted for in your savings account.

Gifts–

You have until year-end to make your annual gift exclusion of $19,000 per person to any person.  Remember that means if you are married, you can basically double that amount and give $38,000 to any individual without any need to file a gift tax return.  Not many of us are in that position to do so, but if you are, let this serve as a friendly reminder that you can gift funds now, and then repeat once the clock hits midnight on 12/31.

529-

Are you saving for a child or grandchild’s college expenses?  If so, no time like the present to funnel funds away, by gifting, to a state-sponsored 529 account.  Remember, many states give some form of tax benefits for doing so, thus worth maximizing the tax benefits and minimizing what you pay Uncle Sam.  Make sure to check what your state-specific benefits are, assuming you have, and give in a way that both benefits the recipient and you, the taxpayer.

Roth Conversions-

Time is running out if you have crunched the numbers and think this is the year to do a Roth conversion.  Unlike contributing to a Roth, which you have until April 15^th of the following year to make a contribution for previous years, when doing a Roth conversion, the funds must be converted before year’s end.

Review your financial goals–

It is so easy to get caught up in the rat race we call life.  Most of us are working towards something, and no time like the end of the year to see how we are trending towards our financial and life goals.   Personally, I hit on about 3/4 of my annual goals and really just have one big one I didn’t accomplish in 2025, which was to lose 15 pounds if those curious minds.  I hit on my savings, debt paydown, health, and other goals.  I’m happy with where I am positioned in much of my financial life, although plenty of room to improve.  Don’t beat yourself up if you are lagging on any of it; rather, shift that focus to what needs to be done in the year ahead to get back on track. 

Cheers

Whatever you have planned for the holiday season, know that we here at Diversified wish you a happy and healthy holiday.  May next year bring you nothing but joy and laughter, and a little closer to those life goals.  Oh, and remember to stay wealthy, healthy, and happy.