A Financial Planning Checklist For The End of The Year

It seems like the end of the year always arrives before we are entirely ready for it, but it doesn’t have to be this way with your finances. The closing months of 2022 are an excellent time to set yourself up for success in the coming year. A checklist is a helpful way to tie up loose ends with your finances. So here are some helpful reminders to square up on your financial planning checklist for the coming year.

Max Out 401K Contributions Before The New Year 

If you aren’t yet thinking about retirement, now is a good time to start! A 401K is a good way to save for your future retirement. This type of retirement account is usually set up by an employer. It allows you to put money aside tax-free to use when you are done working. (The money is taxed when you withdraw it from the account). The limit for maximum contributions to a 401K at the end of the calendar year is $20,500 for 2022. 

On the other hand, a Roth IRA is established by an individual and has a maximum contribution limit of $6,000 for 2022. The money is taxed before it goes into the account (instead of after, like the 401K). Contributing to your retirement saving goals annually, as discussed with a financial planner or outlined in your budget, means you’ll have enough money to live on when you choose to stop working. So before the limits reset, get your contributions in ahead of December 31, 2022. 

Pay Down More of Your Debt (or Refinance It)

There’s never a better time to start paying down your debt than now. Good practices like paying more than the minimum balance (to reduce the interest) will help you a lot in the long run. One strategy that’s helpful is to tackle your most expensive loan or credit card balance first and work your way down the list. If you’ve had extra earnings come in, making more than one loan payment a month is also a great strategy to shorten the life of your loan.

Refinancing your debt is another avenue to explore on your financial planning checklist if you’d like to get better interest rates or simplify your payments. Check out our DEXSTA Visa Platinum card and Visa Platinum Rewards cards for a 2.99% introductory rate on all purchases for 12 months. After that, you’ll get the same interest rate for 18 months on balance transfers, with no fee for balance transfers or cash advance fees. 

Get a Copy of Your Credit Report

Speaking of credit cards, opening a new line of credit is the perfect opportunity to get up to date on your latest credit score. It’s important to understand your credit score for future loan opportunities like taking out a mortgage or buying a car. Experian, Equifax, and TransUnion are the three consumer reporting agencies that accurately report credit scores. 

Once a year, it’s essential to check your reports to ensure the information is accurate. This helps monitor any false breaches from identity theft or fraudulent activity on your credit cards. In addition, knowing your credit score gives you control and confidence over your future borrowing power and current financial data. 

Update or Assign Account Beneficiaries as Part of Your Financial Planning Checklist

Deciding who has access to your investments, 401K accounts, and financial assets is a critical but often overlooked detail of financial housekeeping. Choosing a beneficiary is one of the essential steps in setting up a new financial account. This is your chance to provide clear directives on what to do with your money in your absence. 

Usually, this is as simple as entering your beneficiary’s information into the online portal of your financial institution, or it may require a simple phone call. It can be done in less than 10 minutes and is a positive step on your financial planning checklist to make sure your money goes where it’s meant to in the future.

With DEXSTA, Start 2023 On The Right Track

Taking care of these financial housekeeping items will help you gain greater peace of mind and control over your future. So make space for 2023 with these steps and finish the year strong. If DEXSTA can help you open a new account, take out a loan, apply for a mortgage, or anything else, let us know by calling us at 302-571-0522 or getting in touch via our contact form. We’re here for you!