The holidays are a magical time full of gatherings and parties, friends and family, gift giving and of course the promise of a new start come January 1st. But before we ring in the new-year, there are a few financial moves worth considering. These three simple money-saving opportunities can help you start 2023 with a little extra green.
1) Make a year-end charitable gift - The holidays are known as the “season of giving.” Whether you are passionate about animals, the environment or any non-profit, make a donation before December 31, to your favorite charity. If you are 70 ½ or older, you can make a qualified charitable distribution (QCD) from your IRA. A QCD can be more valuable that making a contribution directly to the charity and then taking a deduction.
2) Make sure to use your FSA funds – Since contributions made to a flexible spending account are non-taxable they are a great option when paying for some health costs, like deductibles, over-the-counter meds and some everyday health needs. While some FSA funds can be rolled over each year, many are lost if not used within the year. It’s a good idea to use as much of your FSA funds before Dec. 31 so you won’t risk losing any money left in the account.
3) Maximize your 401(k) contributions – This is a win-win strategy! Not only will you be saving money for retirement, but you will also save money during tax season.
And as always, review your allocations with your financial advisor. You can’t control the market but you can assess your investments and make sure they continue to be aligned with your goals. If you don’t already have a financial advisor, we’d love to speak to you! We look forward to hearing from you. Happy Holidays!