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Money / Financial Planning


EXPERTS: MAKE THESE 9 MONEY MOVES BEFORE END OF YEAR

BY ANDREW LISA

October 23, 2022

damircudic / Getty Images

With the weather cooling and Halloween decorations springing up everywhere you
look, the calendar is turning to its fourth and final quarter of 2022. That
leaves you just three months to finish the year strong and enter the new year in
a solid financial position.

See: 22 Side Gigs That Can Make You Richer Than a Full-Time Job
Looking To Diversify in a Bear Market? Consider These 6 Alternative Investments

What you do right now could determine whether 2023 is the year you finally
achieve financial freedom or if you find yourself slogging through yet another
365 days stressed about bills, debt and bad money decisions. 

GOBankingRates asked the experts about what people should do this fall and early
winter to ring in the new year the right way. This is what they said.


START FRESH, SET NEW GOALS AND MAKE A PLAN

It’s resolution season — but those rarely last. Instead of making lofty
self-promises that probably won’t come to fruition, turn over a new financial
leaf for 2023 with a plan based on realistic goals.

“Before the year is over, I would highly encourage individuals to take time to
set actionable financial goals for themselves for the new year,” said Brad
Cummins, owner of Insurance Geeks.

Building Wealth

“So many people tend to wait until the new year begins to start setting goals,
but the earlier, the better. Make sure to be very specific about your financial
goals and even set a deadline for yourself so you can keep yourself accountable.
Write those goals down, whether in list form, on a vision board or in a journal,
and make sure to remind yourself of these goals throughout the year.”

Take Our Poll: Do You Have an Emergency Fund Established?


MAKE A PLAN FOR ANY YEAR-END WINDFALLS

One of the saddest stories to come out of the pandemic was the huge number of
people who squandered their stimulus payments — which could have been
life-changing money — on unplanned overspending. The days of stimulus checks are
in the past, but if you have a bonus or some other stash of cash coming your way
at the end of the year, avoid making that same mistake by planning ahead now.

“Instead of rushing to spend your bonus or incentive on a new gadget, bag or
clothes, click the ‘transfer money’ button on your online banking app and send
it straight into a savings or investment vehicle,” said James Parsons, a
businessman, financial expert and CEO of Content Powered.

Building Wealth

“The less you have access to your money through online channels, the lower the
risk of spending it, and the higher you increase your wealth.”


CHECK YOUR CREDIT

If you’re planning to borrow money or make a big purchase in 2022 — or even if
you’re not — revisit your credit report, see where you stand and check for
errors.

“Check your credit reports if you’ve not done so within the past year,” said
Sean Fox, chief revenue officer and president of debt resolution at Achieve
Resolution. “Credit reports are free, once per week, from each of the major
credit reporting agencies — Experian, TransUnion and Equifax. Visit
AnnualCreditReport.com, then review the reports carefully. If you find any
errors, correct them by following the directions on each agency’s website.”


CONSIDER CUTTING INVESTMENT LOSSES TO MINIMIZE TAXES ON CAPITAL GAINS

Greg Wilson, chartered financial analyst and co-owner of ChaChingQueen.com, said
that now is the time to look at any securities you have in taxable accounts.

“If you notice that any have unrealized losses, talk to your financial advisor
about tax-loss harvesting,” Wilson said.

He refers to the strategy of intentionally selling securities at a loss to
offset capital gains taxes you owe on any winners you sold during the year. And
Wilson is right — that’s definitely something you want to run past a financial
pro first.

Building Wealth


GIVE YOUR BANK AN ANNUAL PERFORMANCE REVIEW

Sofía Ramírez, global head of marketing at the personal finance platform Tend,
suggests holding your bank’s feet to the fire before the year runs out.

“Ask yourself: Is your financial provider on your side? Are they completely
transparent? Do they provide access to tools to help improve your financial
literacy and make better, more informed decisions? Do they care about
collaboration? Do they offer you the rewards you deserve?” Ramírez said.

“If you answered no to one or more of those questions, then it may be time for a
switch to another banking service that offers more personalized attention to
your finances and goals.”


IF YOU DON’T HAVE A RETIREMENT ACCOUNT, OPEN ONE NOW

If you’re not saving for retirement, the single best thing you can do is open a
tax-advantaged account and stuff as much money into it as legally possible
before New Year’s Day. Not only will you start building a nest egg, but you very
well might lower your 2022 tax bill.

“When you put money into an investment vehicle like an IRA or 401(k) before Dec.
31, that contribution will reduce your taxable income for the final tallies in
January,” said Jonathan Svensson, co-founder of the financial education website
Almvest.


IF YOUR ALREADY HAVE ONE, MAX OUT YOUR CONTRIBUTIONS (OR DO THE BEST YOU CAN)

If you have been kicking money into a retirement fund, you’re on the right
track. But the key is to max out your contributions — or at least to come as
close as you can.

“If you make contributions every month, you may not think to do anything extra
at the end of the year,” said Olivia Tan, a Florida-based personal finance coach
and co-founder of CocoFax. “However, the more money you can contribute, the
better.”


THE SAME GOES FOR HSAS

Health savings accounts are versatile savings vehicles that you can use now and
carry with you into retirement — the more money you have in yours, the better.

“If you have a health savings account, make sure that you’ve contributed the
maximum amount that you’re allowed to before the year’s end,” said Zach Reece,
owner and COO of Colony Roofers in Atlanta and a CPA who was formerly employed
by Deloitte.

“If you have an eligible health insurance plan and an HSA, contributions to your
HSA are tax-deductible.”


PLAN FOR NEXT YEAR’S CONTRIBUTIONS NOW

Once you’re done playing catch up with this year’s tax-advantaged accounts, plan
for how you’ll build your savings starting in January so you don’t find yourself
in the same position at the end of 2023.

“Time to start thinking about how you can maximize your contributions for the
next year,” said Francis Locknear, founder and CEO of TheCostGuys.com, a
financial education site. “Remember that each year, your contributions will
increase. You may need to evenly spread out your contributions all year and
adjust your monthly contributions once January rolls in. Determine how much you
need to contribute every month beforehand.”

If your paycheck was too small this year and your refund was too large, now is
the time to think about tax allowances, too.

“Make sure that you know how much you need to withhold for taxes from your pay,”
Locknear said. “Take a look at your current tax allowances to help you break
even during tax time. It will let you avoid any confusion and frustration once
tax time rolls around.”

More From GOBankingRates

 * Top 10 Richest People in the World
 * Get Top Holiday Shopping and Savings Tips
 * 5 Things You Must Do When Your Savings Reach $50,000
 * 10 Things to Do Now If Your Credit Score Is Under 700

Share This Article:



BY ANDREW LISA

October 23, 2022




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Building Wealth


ABOUT THE AUTHOR

ANDREW LISA

Andrew Lisa has been writing professionally since 2001. An award-winning writer,
Andrew was formerly one of the youngest nationally distributed columnists for
the largest newspaper syndicate in the country, the Gannett News Service. He
worked as the business section editor for amNewYork, the most widely distributed
newspaper in Manhattan, and worked as a copy editor for TheStreet.com, a
financial publication in the heart of Wall Street's investment community in New
York City.
Learn More


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 * 10 MIDWEST CITIES THAT COULD BE HEADED FOR A HOUSING CRISIS
   
   By Jordan Rosenfeld
   For the past few years the housing market has been so hot it seemed to defy
   the economic downturn brought about by the pandemic. While many people were
   losing...
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 * 8 SOUTHERN CITIES POISED FOR A HOUSING CRISIS
   
   By Jordan Rosenfeld
   The South is so iconic, full of rich history, gorgeous scenery, and diverse
   groups of people, that it seems like its housing markets would be on a
   constant...
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 * WHY YOU SHOULD IGNORE THE MONEY ADVICE YOUR PARENTS GAVE YOU
   
   By Selena Fragassi
   Growing up, we think our parents know everything. They're the ones to help
   teach us our biggest life lessons, from how to cure a broken heart to how to
   drive. But when it comes to money, the times...
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 * AMC NETWORKS IS LATEST TO ENACT LARGE-SCALE LAYOFFS FOLLOWING CEO’S DEPARTURE
   — COULD MORE FOLLOW SUIT?
   
   By Yaёl Bizouati-Kennedy
   AMC is the latest company to announce massive layoffs, letting go of 20% of
   its workforce, according to several reports. The news came on the same day as
   company CEO Christina Spade stepped down from...
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