As the year comes to a close, it is the perfect moment to review your financial world, make thoughtful updates, and ensure everything aligns with your goals. A strong finish sets the tone for a confident start to the year ahead.
What is Year-End Financial Planning?
It is the process of reviewing your finances, investments, taxes, and estate documents before December thirty first. This gives you the chance to look back at the past year, identify opportunities, and make strategic adjustments that support your long-term goals.
When to Begin
Now. The earlier you review your financial picture, the more options you have to make meaningful changes before year’s end.
Below is a comprehensive checklist for individuals and families seeking clarity, direction, and organization as they prepare for the new year.
Your Year End Financial Checklist
Review Your Financial Plan
Reflect on how your life may have changed in the past twelve months. Any major events should be incorporated into your financial plan, so it continues to reflect your goals and priorities.
Life changes that may require updates include:
Marriage or divorce
Birth or adoption of children
Job changes, career shifts, or promotions
Home purchases or sales
Inheritances or major investments
Health changes that affect planning
If you do not have a financial plan in place, this is an ideal time to create one.
Evaluate Your Investments
Review whether your current portfolio still complies with your own investment policy, formal or informal, and your long-term goals.
Consider reviewing:
- Diversification across asset classes
- Review tax implications of portfolio changes throughout the year
- Is rebalancing needed to keep your portfolio aligned with your objectives?
Review Your Tax Picture
Your financial plan and tax plan should move together. If you experienced significant life changes this year, your tax strategy may need adjustments.
Important items to review:
Filing status
Withholding updates on your W four
Tax loss harvesting opportunities before year end
Timing of charitable gifts
Required minimum distributions
Estimated tax payments and year end adjustments
Thoughtful tax planning in December can help you avoid surprises in April.
Maximize Retirement Contributions
Consider increasing contributions to your retirement accounts before year end. Even if you cannot reach the maximum, raising your contribution amount can reduce taxable income and strengthen your long term retirement plan.
Contribution limits for 2025:
401k: 23,500
Catch up for age fifty and older: 7,500
IRA: 7,000
IRA catch up for age fifty and older: 1,000
HSA limits vary by plan type
These contributions can support both current tax planning and future financial security.
Review Your Estate Documents
Estate planning is not only for significant transitions. It should be reviewed regularly to confirm that your wishes are documented clearly and your beneficiaries are up to date.
Key items to review:
Will
Living trust documents
Powers of attorney
Healthcare directives
Beneficiary designations on retirement accounts and insurance policies
Guardian selections for minor children
Remember that beneficiary designations override wills, so accuracy is essential.
Create Your Budget for the Coming Year
Use what you learned about your spending and saving habits this year to build a realistic budget for next year.
Include:
Your actual spending from the past twelve months
Updated income
New goals or responsibilities
Upcoming major expenses
Updated savings targets
A thoughtful budget provides structure and clarity for the year ahead.
Why Year-End Financial Planning Matters
Thoughtful year-end planning allows you to:
Identify tax-saving opportunities before they expire
Update your financial plan to match your current life
Keep your retirement strategy on track
Begin the new year with clarity and confidence
Reduce the risk of last-minute tax issues
A Strong Finish Sets the Tone for the Year Ahead
Taking time to review your finances before year’s end helps you step into the new year organized and prepared.
If you would like help reviewing your financial picture or updating your plan, our team is here to support you.
