Financial End of Year Checklist – How to End 2019 Strong

With the holidays quickly approaching, we know you probably have a lot going on in your life. From buying gifts, booking travel to see family, and wrapping up end of year projects at home or work, it’s a busy time for all of us.

But the end of the year is an important time for your finances as well. There are a number of things you can do now to end your year strong financially and set yourself up for success in 2020.

Try to squeeze in some time in the next few weeks before the holidays to get yourself ready for 2020 by using this  2019 End of Year Financial Checklist to end your year like a pro.

2019 Financial End of Year Checklist

1. Max Out Your 401K Match
A lot of employers offer a matching 401(k) contribution plan which is essentially free money to you. So if possible, try to contribute the maximum amount to your 401(k).

As each company has a different policy threshold, always double-check with the HR department to verify their match. You might have already maxed out your match and not even known it. Or you might need to invest a little more in December to get the full match. Don’t leave this free money on the table!

Lastly, if you are past the employer match but want to invest more, the 2019 401(k) maximum contribution is $19,000. If you maxed out the total annual amount already, congrats to you!

2. Rebalance Your Portfolio
The end of the year is always a great time to rebalance your portfolio. As the market has shifted over 2019, your holdings probably have as well. While you should rebalance more than once a year, we understand that sometimes life gets in the way.

Rebalancing your portfolio is a good idea because it ensures that you aren’t weighted toward one asset class because it outperformed another. If you’re already a Bayntree client, feel free to contact us and check your allocation. If you aren’t working with us yet, make sure to schedule a free consultation where we can discuss this further.

3. Use Your FSA Savings
A flexible spending account (also known as an FSA), is another great tool for your financial future. An FSA allows you to contribute up to $2,700 pre-tax dollars for health-related costs that your insurance won’t cover.

The one downside is that most FSA funds expire at midnight on New Year’s Eve and do not roll into next year (like an HSA). If you still have money in your account, use it on things like eyeglasses, contact lenses, acupuncture, and other medical expenses. If you aren’t sure what is eligible, make sure to speak with someone in HR to ensure you don’t lose out.

4. Enroll in a 529 Plan
When it comes to long-term planning for your family, very few investments are as rewarding as a 529 plan for your children. A 529 plan is a college savings plan that offers tax and financial aid benefits for your kids.

With the rising cost of school, it’s a good idea to invest as much as you can for your children’s education. According to Investopedia, “For the 2018 to 2019 school year, the cost of a year of school at a mid-priced college for an in-state student was approximately $21,370, including tuition, fees, room, and board. For students attending an out-of-state school, the cost rises even further, to $37,430.”

To end your financial year, open or contribute additionally to your 529 plans. Your money will grow tax-free and can be withdrawn tax-free if it is used for educational purposes.

5. Review Life Insurance and Future Health Costs with Family
While not always an easy topic to discuss, December is a good time to review life insurance policies and future health costs with family. If you’re like most people, you will probably see your family a lot during the holidays and have extra time to talk about the future.

It’s important to make sure you and your loved ones are well-protected in case anything happens. If you do have enough life insurance coverage, you can also review the different types of coverage available as well.

6. Recap Your Financial Year
The final tip for your end of year financial checklist is to recap 2019. Set some time aside with your spouse and review how the year went. Ask yourself questions like:

  • Did we reach our savings goals?
  • Did we pay off debt? Take on any new debt?
  • How much did our net worth grow? Or shrink?
  • Did we get to travel, have fun, and enjoy ourselves in 2019?
  • What are our biggest financial goals for 2020? How can we set ourselves up for success?

If you need help with these types of questions and want to create a plan for 2020, we encourage you to schedule an appointment with us today.

Hopefully, these tips will help you end the year right and set yourself up for a prosperous 2020!

Bayntree Wealth Advisors, located in Phoenix and Scottsdale, Arizona, provides comprehensive financial planning and wealth management. The Bayntree team specializes in all aspects of financial health, including retirement planning, risk management, investment advice, tax strategies, estate planning and insurance.

Bayntree does not provide specific legal or tax advice. Please consult with your tax advisor or legal professional for guidance with your individual situation.

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