With the end of 2015 quickly approaching, it’s a great time to begin organizing your finances for the New Year. “There are a few easy but important financial-planning items you can take care of as a 2016 gift to yourself and your family,” says John Westerman, a Houston-based financial planner.
Flexible spending accounts
It used to be if you hadn’t used up all the money in your flexible spending account by year-end, you would lose it, but the IRS recently modified this rule to allow a carry-over of up to $500 into the next year. However, it is up to your employer as to whether or not to participate in this option. “If your employer still holds to the “use-it-or-lose it” policy, now is the time to get your kids’ physicals or to stock up on medications that qualify for flexible spending,” says John.
Open enrollment for Medicare started in October and ends December 7, 2015. For many, this is the only chance to change health and prescription drug coverage for 2016. If you want to make any changes, you should act now.
Reporting losses on stock sales
No matter if you hold a long or short trading position, if you invest in stocks you should always be aware of important deadlines regarding trading date closings.
Even if your retirement is not just around the corner, scheduling time with your financial planner before the end of the year to go over employee matching contributions, potential tax benefits and your retirement goals, will help you start the New Year off on the right foot.
Taking stock of savings
How did you do this year on your savings goals? There’s no reason why you can’t make some financial resolutions along with your other New Year’s vows. “If you determine you’re off track, our financial advisors are here to help you develop and monitor a financial plan for 2016,” adds John.
So that your estate plan stays in tune with your goals and needs, you should review and update it on an ongoing basis. If you haven’t done so during 2015, take time before the end of the year to:
- Update beneficiary designations
- Account for any life changes
- Review trustee and agent appointments
- Review provisions of powers of attorney and health care directives
- Get a firm understanding of all of your documents
- Prepare for the distribution of personal effects
- Check trust funding
“This list of key financial planning topics is certainly not exhaustive but can help you better prepare for the coming year and help make 2016 happy, healthy, and prosperous,” says John.