What should you do before the end of 2020 when it comes to your finances? We’ll run through a list of items on this show.
(Click the featured times below to jump forward in the episode)
As the year starts winding down, what kind of things do we need to be thinking about? Amidst the holidays and the end of a tough year, don’t let these financial moves get overlooked.
Are you maxing out your retirement contributions? What about putting money away in a Roth or post-tax account? While you won’t get the tax break this year on money contributed in a Roth, it allows that money to grow tax-free.
Did you take advantage of any of the options in the CARES Act? Are you exploring tax-loss harvesting? Eric explains how tax-loss harvesting works and why you should be aware of it. Sometimes recognizing a tax-deductible loss now will prove to be advantageous. Do you plan to make a major charitable contribution before the end of the year? It may be worth examining your other deductions to see if giving a bit more will help.
Finally, should you be doing a Roth conversion before the end of the year? We don’t know exactly what taxes will look like in the future, but we do know what the taxes are today. A conversion would mean needing to come up with the tax money now, but it might save you a lot in the future when taxes will likely go up.
Listen to the entire episode or click on the timestamps below to skip to a particular year-end to-do.
[1:15] – Are you maxing out retirement contributions?
[2:36] – Are you using the options available in the CARES Act?
[3:50] – What is tax-loss harvesting and why should we explore it?
[6:44] – Are you making charitable contributions?
[8:28] – Should you do a Roth conversion?
“You can’t have too much tax-free money, but paying it along the way can be difficult.“
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