End of Year Financial Planning Checklist
6 time sensitive financial moves you should consider now, in order to successfully close out 2018.
With the holidays upon us, it can be difficult to make time to get your finances in order. Many people push out closing their year until well into the next year (ever scramble in April to get all your tax work completed?). But there are several time sensitive financial moves you should consider now, in order to successfully close out 2018.
Review your open enrollment options and optimize your selections
Make sure that you and your spouse are coordinated on health care and dependent spending and 401k and Roth saving goals.
Adjust your tax withholdings
If you have had a child in 2017, been through a divorce, changed jobs or had a change in income, you will likely need to adjust your withholdings.
Fund long term savings vehicles (401k, Roth IRA, IRA, SEP IRA, 529s).
Contribution limits for your 401k is $18,000 and IRA is $5,500. Beware that there are limits on IRAs depending on your income. If you are self employed, take the time to fund a SEP IRA, which has much higher limits than a standard IRA or 401k.
Check your health and dependent care flexible spending plans
Track down your receipts and enter them now. I like to use this wind fall to fund Christmas. If you have not used all of your money, its time to do it now. Also, if you have hit your health care deductible, it may make sense to hit the doctor one more time to take care of anything you have been putting off.
Set an end of year budget.
There is a lot going on: gifts, travel, family events, parties, family pictures. Start to think, at the very least, about some guard rails that you want to set.
Start Planning for Next Year
Set up a meeting with your financial planner. Now is the time to start setting some longer term goals for next year and help secure your retirement for tomorrow. Let me guide you through the process and monitor your progress.
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The Problem with the Majority of Parenting and Investment Advice.
I read an article on the Farnam Street blog, 5 Mental Models to Remove (Some of) the Confusion from Parenting and was struck by the similarity between the common pitfalls with parenting and personal finance advice and the approaches we often take:
I read an article on the Farnam Street blog, 5 Mental Models to Remove (Some of) the Confusion from Parenting and was struck by the similarity between the common pitfalls with parenting and personal finance advice and the approaches we often take:
"Few topics provoke more unsolicited advice than parenting. The problem is, no matter how good the advice, it might not work for your child. Parenting is the ultimate “the map is not the territory“ situation. There are so many maps out there, and often when we try to use them to navigate the territory that is each individual child, we end up lost and confused. As in other situations, when the map doesn’t match the territory, better to get rid of the map and pay attention to what you are experiencing on the ground...
...As in any other area of your life, developing some principles or models that help you see how the world works will give you options for relevant and useful solutions. Mental models are amazing tools that can be applied across our lives."
Are you caught up in tactics without a clear mental model or strategy?
Many of us save a few bucks every month, stash money yearly in our kids 529s, and invest in our company's 401k plans. All super good things to do, but will it get you to where you want to be? Do you have a set of family goals that inform all areas of your strategy? Here are a few of mine:
I want my kids to be self-reliant adults who will make a difference to society. That means I am comfortable if they fail often, as long as they win in the long run. They play a variety of sports, play violin or the sax and arent bashful about speaking Spanish to a stranger. If you have heard a 10 year old practicing violin, you know the sound of failure. And we save each year so they can go to sleep away camp for part of the summer, where they learn how to make friends and learn on the fly.
I want the freedom in my own life to make choices not based entirely on finances. That means I invest part of every paycheck, whether the market is up or down, so that I can create long term wealth. And we prioritize traveling for new and unexpected experiences. That means Jenn and I have a weekly family budget and stick to it, even if we have to forgo some fun now.
Are you living by tactics as you go? Have you developed a set of guiding principles? If you haven't, you are not alone. Want to live free of financial burdens and have peace of mind? You'll need a strategy and a plan. I can help.
Let's talk about your personal financial goals. Contact me to set up your free consultation.
How to Pick a College That's Worth the Expense
Picking a college is one of the most important early decisions one can make. Its arguably the most important decision…
Picking a college is one of the most important early decisions one can make. Its arguably the most important decision (other than choosing a suitable mate) in determining the trajectory of someones future. Money Magazine published a thoughtful analysis on the Top 25 List of the Best Colleges that graduates are likely "able to avoid heavy debt and succeed in the workplace".
Yes, my alma mater, Ga Tech is ranked 19th!! Tech has long been ranked one of the best values in college. I like how this article expands the data to include the ability to quickly escape the heavy burden of debt.
Have questions on how to help your kids limit their debt burden due to college expenses? Call or email Josh.