The start of a new year is an ideal time to get things in order in your life and your finances. Schedule some time to check in on your accounts, organize tax documents and automate retirement contributions to help set yourself up for success.
Make a plan if you’re turning 65: This is the age you become eligible for Medicare; a 10% premium penalty applies for each year you go without Part B coverage beyond this birthday in most cases. You have seven months to enroll, starting from three months before your birth month.
Avoid frenzied filing: By January’s end, you should have tax forms in hand. Make sure to organize them, as well as any receipts if you itemize. Talk to your advisor about coordinating with your tax professional to ensure all is in order.
Bolster benefits: Research your company’s open enrollment schedule and decide if you need to make changes.
Check up on health spending: If you participate in a flexible spending account (FSA) or health savings account (HSA), review your contribution levels to take full advantage – without exceeding applicable limits. If you have an FSA, use available funds before your plan’s use-it-or-lose-it deadline if there is one.
Be smart about your bonus: Think about how you want to use your year-end bonus before it hits your checking account. Consider paying down high-interest debt, shoring up your emergency fund, or increasing your 401(k) contribution.
Automate saving: If you haven’t automated retirement contributions, start now. It’s also a good time to reconfirm your employer match and increase your contributions to allow more time to generate tax-deferred gains.
Sidestep IRA issues: Pre-tax contributions to IRAs can reduce taxable income, and you have until April 15 to contribute for the current tax year. You also have the option to contribute early in the year toward the next tax year – so tell your IRA custodian which year the contribution applies to.
View the complete checklist below and talk to your advisor to make sure you don't miss any important financial planning dates this winter season.
Withdrawals from tax-deferred accounts may be subject to income taxes, and prior to age 59½ a 10% federal penalty tax may apply. Investment products are: not deposits, not FDIC/NCUA insured, not insured by any government agency, not bank guaranteed, subject to risk and may lose value. Raymond James financial advisors do not render legal or tax advice. Please consult a qualified professional regarding legal or tax advice.