Hi y’all —
We all know Santa's making a list and checking it twice. But what kind of list, you ask?
An end-of-year money to-do list, of course!
We've got *checks notes* 21 days until Christmas and 27 days until the ball drops, which means it's prime time to conduct a financial checkup before the new year arrives. A lot of these tasks involve "setting yourself up so there's no surprises in 2025" — so you're not playing catchup or worrying about something you should have already done, Alanna Morey, a private wealth advisor with Ameriprise Financial, tells me.
Need a more detailed gameplan? Read on for the list of things I plan to do before the end of the year.
✅ Revisit my budget
Jaime Eckels, partner at Plante Moran Financial Advisors, says December is a great opportunity to look back at the previous year and determine whether I stayed on target.
I should scrutinize my credit card statements and ask myself: How did my plans work out? Was I able to follow my budget? Did I spend way more than intended on, say, grande vanilla sweet cream cold brews at Starbucks and didn't save enough for the rumored Jonas Brothers 20th anniversary tour?
"We always talk about budgeting and how important it is — and it really is — [but] it only works if you can actually check back and reflect and see how you did compared to what your goals were," Eckels says.
I can then take these learnings and apply them to my spending plan for 2025. For instance, if I wasn't able to stick to 50-30-20 in 2024, maybe I need to adjust those thresholds. If surging home and auto insurance premiums are dragging me down, maybe I need to shop around for better rates.
✅ Save for retirement
Morey tells me to check in on my retirement savings plan. If I have an individual retirement account, or IRA, there's still time to max it out for 2024: The deadline for IRA contributions is April 15, 2025. I can put away as much as $7,000 ($8,000 for folks age 50 or older) in my traditional and Roth IRAs, though Morey points out that there are income limits to consider.
I can stash as much as $23,000 in my 401(k) for 2024 (people 50 and up can throw in an extra $7,500). These contributions generally have to be organized through work, but there's still time to contact my company's payroll department and ask to sneak in a bit more from my remaining paycheck(s). 401(k) contributions have a Dec. 31 due date.
✅ Meet end-of-year deadlines
New Year's Eve isn't just for downing copious amounts of champagne and finally figuring out how in the world they're going to make "2025" into glasses. It's also the deadline for older Americans to make required minimum distributions, or RMDs, from their retirement accounts. (The rules on this recently changed because of the SECURE 2.0 Act, so pay close attention.)
Dec. 31 is typically the last day for me to spend funds in my Flexible Spending Account, or FSA, too. (I say "typically" because some FSA plans have different deadlines.) This money is use-it-or-lose-it, but luckily there are a ton of ways to use it: FSA-eligible items include sunscreen, vitamins, tampons, contacts, acupuncture, travel pillows and more.
