The end of the year is necessary to reflect on your financial picture, review the last 12 months, and plan for the future. With all that is involved, it can seem overwhelming. Consider breaking up the responsibilities over twelve days, focusing on one each day, and ensuring it gets a comprehensive review.
☐ DAY 1 – Reviewed my financial plan in preparation for meeting with a financial professional
☐ DAY 2 – Conducted my year-end tax review
☐ DAY 3 – Reviewed my retirement accounts
☐ DAY 4 – Reviewed my investment portfolio and rebalanced it if necessary
☐ DAY 5 – Reviewed my spending and modified my budget
☐ DAY 6 – Reviewed my debt repayment plan – evaluated my progress
☐ DAY 7 – Contributed to my 401(k) (deadline is December 31st)
☐ DAY 8 – Reviewed my beneficiaries
☐ DAY 9 – Claimed a 529 Plan deduction
☐ DAY 10 – Withdrew my required minimum distributions (If applicable)
☐ DAY 11 – Reviewed tax deductions for donating to charity
☐ DAY 12 – I scheduled a consultation with a financial professional to discuss where my family and I stand financially and how we can make improvements.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial professional prior to investing.
Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.
Asset allocation does not ensure a profit or protect against a loss.
Rebalancing a portfolio may cause investors to incur tax liabilities and/or transaction costs and does not assure a profit or protect against a loss.
Contributions to a traditional IRA may be tax deductible in the contribution year, with current income tax due at withdrawal. Withdrawals prior to age 59 ½ may result in a 10% IRS penalty tax in addition to current income tax.
The Roth IRA offers tax deferral on any earnings in the account. Withdrawals from the account may be tax free, as long as they are considered qualified. Limitations and restrictions may apply. Withdrawals prior to age 59 ½ or prior to the account being opened for 5 years, whichever is later, may result in a 10% IRS penalty tax. Future tax laws can change at any time and may impact the benefits of Roth IRAs. Their tax treatment may change.
Prior to investing in a 529 Plan investors should consider whether the investor’s or designated beneficiary’s home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in such state’s qualified tuition program. Withdrawals used for qualified expenses are federally tax free. Tax treatment at the state level may vary. Please consult with your tax advisor before investing.
This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.
LPL Financial Representatives offer access to Trust Services through The Private Trust Company N.A., an affiliate of LPL Financial.
All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.
This article was prepared by LPL Marketing Solutions
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[i] Retirement Topics – Catch-Up Contributions | Internal Revenue Service (irs.gov)
[ii] What is the Penalty on 529 Plan Withdrawals for Non-Qualified Expenses? – Savingforcollege.com
[iii] Retirement Topics — Required Minimum Distributions (RMDs) | Internal Revenue Service (irs.gov)
[iv] The Complete 2022 Charitable Tax Deductions Guide (daffy.org)
[v] Charitable Contribution Deductions | Internal Revenue Service (irs.gov)