10 End of the Year Financial Tips

In the midst of all of the holiday parties, family celebrations, and the looming tax season, take some time to assess your financial health. Regardless of your financial situation, there is always something you can do to boost your bottom line in the upcoming year. Here are 10 financial tips to aid in your financial success next year.

1. Update or Create a Budget
The end of the year is a great time to do a budget assessment. Using the current year’s information, look at the areas that were successful. What method, if any, did you use to meet a savings goal? Take that method and apply it to any areas that weren’t as successful. If you paid off any debt, see where that former monthly payment would be best applied moving forward. Even a small, $20 monthly payment, when added to a current monthly payment, can help you pay down debt faster.
Don’t have a budget? Now is the time to start! The end of the year is an excellent time to start a budget since you will have a full year’s worth of financial information to work with. Make sure to pay attention to areas of high spending and set goals for yourself.

2. Review Insurance Policies to Make Sure You Have the Right Coverage
Take a look at your current auto and home insurance policies. Are you paying too much for services you no longer need? Use the end of the year as an opportunity to reduce your insurance payments and increase the money in your pocket next year.

3. Save Early
Get out your calendar for next year. If there are any weddings, anniversaries, celebrations or birthdays that you know about in advance, start saving now. Even setting aside $5 or $10 a week can add up quickly and will help reduce any last-minute surprise gifts that can hurt your budget. The same thought applies for holiday spending. It seems too early to start thinking about next year’s holiday season, but if you start saving early, you can enjoy the season more without the looming threat of holiday debt hanging over your shoulders.

4. Start Saving For Retirement
While you are assessing your budget, make sure to start saving for retirement. It is never too early to save for retirement and the sooner you start contributing, the more you will benefit when you decide to retire. If you currently have a retirement plan in place, check your budget and see if you can make any additional contributions before the end of the year.

5. Review Your Credit Score
It is recommended that you check your credit score once a year to reduce your risk of identity theft. Checking your credit score is also a great way to see any areas of debt that need to be addressed. You can see which accounts need to be dealt with first and also gain a better understanding of how your credit score is affected.

6. Check Your Tax Withholdings
The end of the year is a great time to check your tax withholdings at work. If you had a recent life event (marriage, adoption or birth of a child), make sure your withholdings are appropriate to ensure the maximum benefit throughout the year.

7. Plan Ahead For Education Expenses
Just like retirement, it is never too early to start saving for education expenses. Whether you are planning on pursuing higher education, want to change career paths and seek more training, or have a child you want to start an education fund for, starting a savings account and making investments for the future are excellent practices to have in place. Even a small monthly contribution, if started early enough, can compound into something substantial with enough time to grow.

8. Review Investments and Retirement Contributions
If you work for a company that matches your retirement contribution, use the end of the year to assess if you can afford to max out that contribution. If you aren’t currently contributing to a retirement fund, start now! Set up your contribution to begin with the New Year and don’t let that saving potential pass you by.

9. If You Have Any Extra Income, Consider Making a Charitable Donation To Maximize Your Tax Deduction
This may not be realistic for everyone, but if you have any extra income at the end of the year that isn’t allocated into a specific account or budget line, making a charitable contribution is a great idea. Not only altruistic, if you can make the donation before the end of the year, you can take advantage of the tax deduction.

10. Discuss Various End-Of-Life Plans With Family
Never an easy topic to breech, it is always better to discuss your parents plans and wishes before they may not be able to communicate them in the moment. If you have recently had a child or gotten married, now is the time to put together a will. Sit down with your partner and decide on a guardianship plan and life insurance options.

Even though these may not be the easiest topics to discuss, experiencing a little discomfort at the end of the year can set you up for a more comfortable New Year and future.