Your Year-End Financial Checklist
As we approach the end of the year, it is the perfect time to reset and set the stage for a stronger financial year ahead. A year-end review with your financial advisor can help restore clarity, reduce stress, and allow you to be proactive for the coming year. In this blog we will assemble a year-end financial checklist to consider as you wrap up 2025!
Update Your Personal and Financial Information
Have you experienced any major life changes over the past year? Did you marry or divorce? Has your family grown? Have you had a career change or move into a different home? Have you received any new inheritances?
These are all important questions to discuss with your financial advisor as prepare for the year ahead. Your advisor will note any major changes and make necessary adjustments to your investment portfolio. As you sit down with your advisor it is important to ensure that contact information and account access are both up to date.
It is also a good time to confirm and update beneficiaries on retirement accounts, insurance policies, and other documents.
Review Your Cash Flow and Budget
Now is the time to also reflect on spending trends over the year. To set yourself up for success in the new year, reassess your monthly expenses, debt payments, and savings targets. You can partner with your advisor to adjust goals for the year ahead, based on any lifestyle changes or new priorities.
Maximize Retirement Contributions
Review your year-to-date contributions to 401ks, IRAs, and HSAs. Review all investment allocations with your advisor to make sure they still align with your long-term goals and risk tolerance.
Evaluating Investment Accounts
This is the time to revisit your account performance with your advisor relative to your goals. Your advisor will be able to rebalance your portfolio if allocations dictate. It is also a good time to consolidate old accounts to simplify your portfolio management.
Prepare for Required Minimum Distributions (RMDs)
Speak with your advisor to confirm if it is the first year an RMD is required for your IRA or employer plans. It is important to make sure distributions are completed before year-end to avoid penalties. Consider using charitable giving strategies such as qualified charitable distributions to meet your RMDs for the year.
Assess Insurance and Risk Management
The end of the year is a great opportunity to review life, disability, long-term care, home, and auto coverage. You can confer with our risk management specialist to identify gaps and any over-insured areas and create a plan for the year ahead.
Organize Key Financial Documents
Starting the new year with your financial paperwork well-organized will set you up for success. Gather tax documents, statements, and receipts from the previous year. Store it all securely and make sure trusted individuals know where to find critical information. This is also a great opportunity to go paperless with these documents where it is possible to streamline organization for the year ahead.
Clarify and Refresh Your Goals for Next Year
During your year-end review, revisit short and long-term goals – home buying, education funding, retirement timelines, travel, philanthropy, etc. Schedule regular check-ins with your advisor and set achievable action steps for the first quarter of the year.
Year end organization is among the most effective financial habits. Be sure to share life updates with your financial advisor – large or small – to make certain your portfolio is well aligned with your unique circumstances and risk tolerance. Please seek guidance from your advisor in reviewing and refining your year-end plan.
The material has been gathered from sources believed to be reliable, however West Michigan Advisors cannot guarantee the accuracy or completeness of such information, and certain information presented here may have been condensed or summarized from its original source. To determine which investments or planning strategies may be appropriate for you, consult your financial advisor or other industry professional prior to investing or implementing a planning strategy. This article is not intended to provide investment, tax or legal advice, and nothing contained in these materials should be taken as such. Investment Advisory services are offered through West Michigan Advisors. Advisory services are only offered where West Michigan Advisors and its representatives are properly licensed or exempt from licensure. No advice may be rendered unless a client agreement is in place. Securities offered through Level Four Financial, LLC, a registered broker dealer and Member of FINRA/SIPC.