Fall is the perfect time to take a close look at your finances and make some smart money moves. Financial experts say that by taking certain steps now, you can save money, time, and avoid headaches next year. One important thing to do is to make sure you have accounted for any charitable contributions you have made before December 31.
These can provide valuable deductions when you file your taxes in April. Another step to take is to review any investments that are not doing well. You can use a strategy called “tax-loss harvesting” to sell assets at a loss and offset any capital gains.
This can help reduce your tax bill. Kathleen Sablone, a financial and estate planner, says it is also a good idea to review your insurance policies, especially your homeowner’s insurance. “Your excess liability or umbrella insurance may need to be increased over time.
Fall financial check-up steps
Many people have less coverage than they should,” Sablone said. For families with children in college, it is important to take care of legal documents such as FERPA (Family Educational Rights and Privacy Act).
This gives parents the right to access their child’s educational records, as long as the child allows it. “Even though they’re your child, they are an adult in the eyes of the law,” explained financial planner Alisa Kim O’Neil. Retirees should also make sure they take their required minimum distributions (RMDs) from their retirement accounts by the end of the year.
Starting at age 73, you must withdraw a certain amount each year. “If you miss that distribution, there is a 25% excise tax penalty,” noted Sablone. “Don’t wait until the last minute as processing takes time.”
Finally, fall is a great time to check your credit by requesting a free report from the three major credit reporting agencies—Equifax, Experian, and TransUnion.
You can do this once a year at no cost. By taking these steps now, you can set yourself up for a smoother financial journey in 2024.
