Year-end planning should be a regular component of your financial plan for a number of reasons. For one, it forces you to examine your financial position at least once a year to ensure that you’re still on track to meet your goals. It’s also a good way to stay up to date regarding any changes in tax law or financial limits, such as the amount you can contribute to your retirement plans. But end-of-year planning also offers you a chance to make some additional investments before the calendar turns over and it may be too late. Here are five examples of easy investments you can make before the end of the year.
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Max Out Your Retirement Plan
As year-end approaches, it’s a good time to up your contributions to your retirement plan. Not only will you get additional deductions when you file your taxes, but you can get more money into the markets as they enter what is traditionally the best time of the year, November through April. Of course, nothing is guaranteed in the markets, but anything that will get you to contribute more toward your retirement will likely pay off in the long run. If you can’t afford to completely max out your plan, at least contribute as much as necessary to earn your full company match. From there, try bumping up your contributions by just 1% per month, or per quarter. Generally speaking, you won’t even notice these tiny additional contributions to your plan, but over the long run, they could pay big dividends.
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Add To Your HSA
Just like you can fill up your retirement accounts before year-end to get tax and investment benefits, you can do the same with your health savings account, if you have one. With a health savings account, you can get a deduction on your contributions, tax-deferred growth and tax-free distributions when used for qualifying health expenses. With some HSA plans, you can even invest your money into stocks and mutual funds, just as you would with a regular brokerage account. If you don’t yet have an HSA, verify that you’re eligible to set one up, either individually or through your employer.
Polish Up Your Skills
In many ways, the best investment you can make is in yourself. As year-end approaches, there are still huge labor shortages in the United States. Making yourself a more attractive candidate can result …….