Tackle a few To Do’s each month and you’ll be surprised where you end up this year

“The bad news is time flies. The good news is you’re the pilot.”


Taking care of your personal finances is like tending a garden. The more love you show it, the more reward you’ll see. Setting your intention is key to accomplishing anything. See if these monthly reminders help you accomplish what’s important to you this year.

First Quarter: Reassess the Landscape


Call your estate attorney.
The SECURE Act changes how your retirement assets pass to heirs. You may need to make some changes to conduit trusts that are beneficiaries for traditional IRAs. Check in with your estate attorney.

Understand how the SECURE Act will affect your retirement distributions and savings.
If you work with an advisor, no doubt they will get information out to you shortly. They will also make sure to address the impact at your annual review. No particular rush to meet, but sometime this year you need to reassess.

Adjust your retirement contributions.
In 2020, you can contribute up to $19,500 to a 401(k) or 403(b). If you are over age 50, you can make a catch up contribution of $6,500 for a total of $26,000. The IRA contribution limit is $6,000, plus $1,000 in catch-up contributions for those 50 and older.


Pull together your income tax information.
Your 1099s will trickle in this month. Remember if you signed up for electronic delivery, they won’t come in the mail. Dig out the rest of what you’ll need to give to your CPA. If you set up a Donor Advised Fund for charitable giving in prior years, gathering this information is much easier for tax purposes!

Clean up your records and files.
After you’ve dug out your records to do your taxes, take an afternoon and clean up your files.

  • Throw out marketing materials and anything else that’s not required for tax cost basis or tax records.
  • Keep tax returns and related records for seven years.
  • Put important documents like estate documents, marriage or death certificates, or divorce decrees in a safe or safe deposit box.


Update your net worth statement.
2019 was another strong year in the stock market. It’s a lot more fun to update your financial information when your balances went up. Ask yourself:

  • Do you have enough liquidity? Can you cover at least six months of expenses and any short-term emergencies?
  • Do you need to increase your savings to build up liquidity or get your retirement plan on track?
  • How much debt do you have? Can you refinance any of that to reduce what you’re paying in interest?

Vow to track your spending this year.
Set up a simple budget and make time on a regular basis to track where your money goes. Apps like Mint can help with this task. Sort your expenses by category. Balance out some of the boring, necessary expenses with a few fun things so you won’t be singing the blues:

  • Household: mortgage, real estate taxes, association fees, repairs and updates, landscaping, utilities, food, pets, etc.
  • Insurance: life, disability, health, pet, long-term care, property and casualty, etc.
  • Enjoyment: Eating out, sports, entertainment, hobbies, vacations, cable/satellite TV, books, movies, gifts, etc.
  • Health/personal care: health club dues, out-of-pocket medical expenses, clothing, grooming, etc
  • Dependent care: parents, children, others

Second Quarter: Grow Your Assets


File your tax return and analyze the results.
Have you had a change in life circumstances? Perhaps you need to switch to more tax-free income. Or if your tax bracket is lower, you may want to get a little more yield from taxable bonds. Does it make sense to do a Roth conversion or to take more capital gains this year? Do you have a tax loss carry forward or a charitable carry forward? Talk to your advisor to make the most of your tax situation.

Consider your risk and return investment trade-off.
Your asset allocation is the mix of stocks and bonds in your portfolio. When stocks do well, your allocation may be beyond the threshold you are targeting. You may need to rebalance. Are you still comfortable with the risk you are taking overall? Review your Investment Policy to make sure you’re well positioned for the future.

Think about asset location.
Hold individual stocks and passively managed mutual funds in taxable accounts. For many, but not all, holding fixed income in retirement accounts may make sense. Think about when you need to draw on that money and whether it will ultimately go to your children.


Consider setting up a Donor Advised Fund.
If you give to charity, you may find this type of account helps focus your giving. Instead of writing a lot of checks on the kitchen table at year-end, you can give larger amounts to your Donor Advised Fund, get a tax deduction for the gift and then portion out the donations to charity over time. This is called “bunching” your deductions and it can help you itemize on your tax return if you give larger gifts in staggered years.

Pay down debt.
It’s graduation season and you know what comes with that, right? Student loans. Help your kids get off on the right foot by having a chat about paying down higher interest debt first. You might want to take that advice for yourself too.


Calculate your Required Minimum Distribution for traditional IRAs and retirement plans.
You have until December 31st to withdraw the minimum amount, but why wait? When you’re not in a rush, you can think about where to invest the after-tax proceeds for maximum advantage.

Consider Qualified Charitable Distributions from your traditional IRAs.
Instead of taking required minimum distributions from your traditional IRA, you can give up to $100,000 a year directly to a charity and avoid being taxed on the distribution. This can help lower income that may affect Medicare premiums and Social Security tax.

  • Many custodians will issue checks on your IRA account so you can write checks to the charities you choose. Be sure to start early so the checks can clear on time.

Third Quarter: Protect Your Assets


Appreciate what you have and make sure it’s insured.
It’s easy to take so many things for granted—your health, your home, your “stuff.”

  • Do you have an appropriate level of life insurance? When you children are young, you may want to make sure that the mortgage can be paid off and their education is secure. As you get older, you may be able to drop some coverage.
  • Disability coverage is perhaps more important than life insurance. If you have long-term disability coverage through work, you probably have about 50% to 65% of your salary covered. Check to see if you have a monthly cap on benefits. You may need to supplement this with insurance outside your company.
  • Your personal property needs protection—from fires, floods, theft, damage and many other potential problems. Check to see if you need to make any changes to your coverage and do a home inventory with pictures if you haven’t already. Make sure you have appraisals done on more valuable items. Do you have all drivers insured on your auto coverage? Parents? Kids? Nannies?
  • Know your company’s policy on retiree health coverage. This is key in planning when you can move on to new adventures if you want to make a change before age 65 when you are Medicare eligible.

Check your credit report.
Any of the three agencies will give you one free report a year. With all the identity theft, you may want to consider freezing your credit at all three agencies (Equifax, Experian and TransUnion).


Update your estate plan.
You can do positive things during your lifetime and also at death. When’s the last time you took a look at your will or trust? Consider revising your documents to reflect your values and interests. The new lifetime exemption is $11.58 million per person in 2020.

  • Don’t forget to consider digital assets and write down your passwords.

Update your beneficiary designations.
Make sure your beneficiary designations on your life insurance, retirement plans and other contracts specify the beneficiary you want today. It’s easy to forget to update these as the years go by. Make sure they coordinate with your estate plan.


Check on college funding accounts.
Your children’s success in life depends on it. If your child is in college or starts within the next four years, don’t put all of your funding in stocks. You want to be increasingly conservative (using money markets and bond funds) as your child gets closer to needing the money. If you’re in a 529 Education Savings Plan, you can only change the investment election twice a year—so do so wisely. Many parents are choosing to forgo the “age-based” investment elections and create their own more stable mix of bonds and stocks. That can give you more control over the volatility of the investments.

Fourth Quarter: An Attitude of Gratitude


Sign up for your company benefits.
Most companies have open enrollment in the fall. Think about how much life insurance you need, make sure you have long-term disability, pay attention to retiree benefits like pension plans or stock option exercise deadlines.

File extended tax returns.
Sometimes you can’t file by April 15th. But you need to get this done by October 15th—the last filing date of the year without incurring penalties.


Do year-end gifting.
The holidays are traditionally a time of gratitude. The annual exemption is still $15,000 per person. You can give that amount to as many people as you choose without paying any gift tax.

  • In addition, you can give unlimited gifts to charity. You may want to gift appreciated stock instead of cash if you want to avoid paying capital gains tax. If you itemize, you can deduct 60% of Adjusted Gross Income for cash gifts, 30% for appreciated stock. Think about any prior year charitable carry forwards you may also have to use.

Harvest gains and losses.
November brings one of our favorite national holidays—Thanksgiving—a time of celebrating good harvests. This is also a good time to evaluate the unrealized and realized gains and losses you have on your investments. Don’t forget those loss carry forwards too. You may be able to reposition your assets and help yourself from a tax perspective at the same time.


Do year-end planning.
It’s an election year! Depending on who wins, we may have proposed tax changes that could become law (depends on who wins in Congress too). You may want to check in with your tax advisor, financial planner or estate attorney to see if they have any end-of-year tips.

Reflect on your many blessings.
Studies show it will make you happier! Think about all that you’ve accomplished this year and appreciate the people who have helped along the way. Make sure you tell them they make a difference in your life.

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The information presented here is not specific to any individual’s personal circumstances. To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances. These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.