5 Money Moves To Make By The End of The Year
The mornings are starting to stay cool, football is back, and retail aisles are covered in pumpkin-everything. This must mean we're slowly moving into the fourth quarter of 2017. Many of us need to get serious about taking care of previously postponed business, so below are some suggestions to consider if you haven't already;
Review your savings options
Saving money is important. Safety net accounts or investments working toward a bigger goal (i.e. retirement) don’t happen by accident. What accounts you put money into can save you a ton on taxes as well. Deposits to retirement plan accounts get a full deduction against your top tax rate. For retirement accounts, a couple important deadlines are coming up:
October 1st is the last day to start a Simple IRA or 401(k) for 2017
October 15th is the last day for 2016 Sep IRA contributions (if you filed an extension)
Rebalance your portfolio
With US stock market valuations above most long-term averages, now might be an appropriate time to rebalance the portfolio. Taking gains rarely feels like the right thing to do when markets are high. However, international stocks seem to have found a bottom in 2016, and have outperformed the S&P 500 year to date* (up approximately 20% vs. 8% at the time of writing). Diversification has worked wonders in the past when domestic stocks fall flat.
Create or update your trust
The upcoming Holidays usually bring out of town family, and discussing family assets and long-term intentions may be better to do in person. Final wishes, healthcare directives and powers of attorney are (legally) only as good as their last recorded update. If you’ve had changes in family members, relationships, charitable intentions or business valuations, now might be an appropriate time to sit down with your attorney and consider some updating those trusts.
Plan your giving for the year
The season of giving will soon be upon us, and so is the 2017 deadline (12/31). Consider what giving goals you’ve had for the year, and how you intend to finish 2017. Cash is always accepted by non-profits, charities and children, but giving appreciated assets like stock may help you avoid capital gains taxes. Talk with your advisor and CPA about your options of giving more efficiently.
Review your short-term cash & CD’s
Economic strength and outlooks have lifted interest rates slightly. Many US CD Rates have doubled for 12-month periods, but we’ve seen local clients still getting next to nothing. One client CD was recently offered just 2 cents for every $100 "invested" for 6 months.
If your bank isn’t paying you at least 1% on your 1 year CD’s, give us a call.