Five year-end investment moves to make

man and woman talking to a financial professional

With the end of the year approaching fast, you’ve got a lot of things on your mind.  Between traveling, shopping and prepping for the holidays, don’t forget to carve out time to review your investments. You don’t want to miss out on a potential opportunity to better secure your retirement future or save a little on your taxes. Here are five investment moves to consider doing at the end of the year.

Talk to a trusted advisor 

As part of your year-end financial checklist, meet with your HR representative to review your retirement benefit allocations. Also talk with a financial professional to go over the investments in your retirement plans. A professional can help you identify needs, and uncover risks and opportunities within your financial plan.

Review your retirement assets 

When saving and investing for retirement, make sure you’ve contributed consistently and have an investment plan suitable for your retirement needs. Your investments should reflect the amount of risk you’re willing to take for the return you are receiving. A financial professional can help you identify needs and uncover risks and opportunities within your financial plan. Here's how to choose a financial professional.

Maximize 401(k) contributions

If your finances allow, make extra contributions to your 401(k) plan. The maximum contribution limits often change annually and are different based on age. For 2020, the maximum contribution limit for individuals under 50 is $19,500. If you are 50 and older the max amount is $26,000 ($6,500 catch-up contribution + $19,500 standard contribution). Consider increasing your contribution percentage every year, too. Adding a boost to your contributions may reduce your taxable income and bolster your retirement savings.

Reduce taxes on investment accounts 

Conduct a portfolio checkup. If you’ve sold stocks or mutual fund shares for a gain during the year, consider offsetting those gains by selling underperforming stocks or mutual funds at a loss. There are many things to take in to account before doing this. Speak to your tax advisor and financial professional before making any final decisions.

Review beneficiary designations

Time has a way of changing circumstances, which means you may need to update your beneficiaries. Start by taking a look at who you’ve designated as beneficiaries on your retirement accounts. Then move on to outside investments like individual retirement accounts. 

Don’t lose sight of your finances when the end of the year rolls around. Be proactive about managing your investments and your financial plan. Make it a gift to yourself.

The advice provided is for informational purposes only. Contact a financial advisor for additional guidance.

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