Fall also is a busy time for me as a financial advisor. I have to prepare year-end reviews for clients, get required distributions completed and work on any tax strategies by December.
Besides my financial winterizing for clients, you also have a couple of items to check off this fall. What, you can’t coast into the holidays? Nope. Money never sleeps Sparky.
There are a few items that often get overlooked or even forgotten during the fall. Here are my four:
1. Review your benefits during open enrollment. Open enrollment is a once a year thing. It’s also a good forced reminder to review a few financial issues from your workplace. Changes happen every year like marriage, divorce and the birth of a child. First, review your Flexible Spending Account (FSA). Decide how you’ll use the money or decide if this is the year you need to start using one. Second, review your life and disability insurance. Decide if they need to be increased or decreased.
2. Max out retirement savings. This is a good time to finish contributions to your Traditional or Roth IRA. Because after the holidays you may be short on funds. It’s also a good time to adjust your 401(k) withholding so you can get all the match and the tax benefits. By starting now it gives you a few months to spread it out.
3. Plan your holiday spending. Ah, the holidays! A time to eat, drink and be merry!….and overspend. Why not set aside some funds now to cover gifts for family, coworkers and friends? In fact, why not start the old-fashioned Christmas Club this fall? Set up a dedicated account and transfer money to it every month until next October. At the end of October, you’ll have the cash to either fund the holidays outright, or enough to put a dent in it. I’ve done this since 1992. It’s been a big help, and it keeps me from overspending.
4. Dump your losers. No, not the losers you were thinking of! It might be time to sell positions that haven’t performed well to offset any gains you have in other stocks. If you do it now, you get the tax loss, and a few months later, buy them back if you think they still have potential. It will also offset any gains you have in other stocks.
There are plenty of financial moves you can make every fall. These are the few that we tend to forget or put off. Don’t wait, time is on your side for now. In fact, why wait to subscribe to my blog? You can do it right here for free!