Year-End Financial Checklist

Year-End Financial Checklist


As the year is ending, it’s tempting to ignore the “financial” stuff and instead focus on the holidays. But the year-end is a great time to do a financial review and check-in to make sure your financial house is in order. This year-end financial checklist will help you save money, protect your family in the future and set you up for success to hit your financial goals.          

Year-End Financial Check-In

The end of the year is a great time to check in on the state of your family’s finances. Block off 60 minutes to sit down with your spouse or partner (if applicable) and consider the following questions:

  • Did we stay on budget this year? If not, where did we go over or under and why?
  • Did we hit our savings goals for retirement, emergency savings and college funds?
  • Where can we reduce expenses or increase income?
  • What areas of our financial life feel stressful? Which ones feel good?

Use your answers to these questions to create a budget and spending plan for the new year.  If there are areas for improvement, note these and make a specific plan to do things differently. For example, if you wanted to save $200 each month and only saved $100, can you sign up for automatic transfers from your paychecks to your savings account?

Make a Debt Payoff Plan

Debt can feel very scary and that’s why many people ignore dealing with it. But the end of the year is a good time to assess your current situation and make a plan moving forward. Start by listing out all of the debt you currently have, including the interest rate and deadlines if applicable. This includes your mortgage, autos, credit cards and student loans.

Then decide what you can afford to pay towards your debt every month. You can adjust this number to meet your debt paydown goals. Consider refinancing or consolidating high-interest debt, to reduce the amount of interest you will pay over time. Set a plan to pay each debt item down by a certain date, and make it a priority before spending money on non-essentials.  

You may be able to save money in the long run by re-financing to a lower interest rate auto loan at FNB Community Bank! Feel free to apply online to see if you could save.

Make a Budget for the New Year

A realistic budget is the best way to ensure your family meets its financial goals. Start by looking at your spending for this year, and get honest about where you can cut back. Prioritize items such as retirement and emergency savings and debt paydown. But also don’t make your budget so restrictive that your family won’t stick to it. And don’t forget to build in a buffer for unexpected expenses!

Consider using an online budgeting tool like You Need a Budget or Mint.   

You can use online or mobile banking to track your spending.

Review Your Retirement Plans

While you’re planning for the new year, it’s a good idea to check up on your retirement plans. Start by checking in on your goals – are you saving your target amount to hit those goals? If not, make a plan to increase your contributions next year. Next, how are your retirement savings invested? Work with your financial advisor (if you have one) to ensure you’re invested in a plan that is appropriate for both your goals and your target retirement date.

Lastly, if possible, contribute to your 401(k) or other retirement account before year end. Depending on the type of account you have, you may get a tax deduction for those contributions.  

Contribute to Your Kids’ College Funds

Speaking of tax deductions, there may be tax advantages to contributing to your kids’ college funds before year end. Many states offer tax deductions for contributions to their plans (up to a certain amount). Work with your tax accountant to determine what makes sense for your situation; if you don’t have college funds set up, now may be a good time to do that.

Contribute to Charities

It’s the time of giving so why not donate to your favorite charitable organization? Not only will you be supporting them, you may qualify for a tax deduction, depending on your tax situation. For 2020 only, there is the option to deduct cash contributions up to $300 when you claim the standard deduction.

In order to count for the tax year, donations must be made by December 31st.   

Review Your Beneficiaries

If in the last year you’ve gotten married or divorced, had a child or lost a loved one, you may want to update the beneficiaries on your financial accounts. This includes your bank accounts, retirement accounts, annuities, investment accounts and life insurance policies. Generally, who gets what is determined by who is listed as a beneficiary on these policies even if your will says differently.

It’s also a great time to make sure your will and other end-of-life paperwork is up-to-date (such as a living will, durable power of attorney and health care proxy). Many attorneys offer estate plan bundles at reasonable prices; while this may not seem like a fun expense, it’s a worthwhile one to save your family hassle in the future.

Evaluate Your Insurance Policies

Another area to check in on is your insurance policies – everything from homeowners to automobile to health insurance. The end of the year is a great time to make sure your policies fit your needs and that you’re getting the best price possible. Homeowners policy rates can vary based on crime, inclement weather, etc.; auto policy rates are affected by your driving record – so in both cases, doing a yearly check-in may save you some money.

Even if you don’t change your policies, use this time to gather all of your important documents. Make sure the policy numbers and contact information are saved in one easy-to-reach place. This way, this information is readily available in the event of an emergency.

The Bottom Line

Around this time of year most people are busy holiday shopping, baking and spending time with family. But this is a good time to squeeze in a year-end financial review with your family. Make sure you’re prepared for the new year by using this year-end financial checklist to save you money, prepare your family for the future and put you on track to hit your financial goals.

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