As 2014 draws to a close, you may want to look back on the progress you\u2019ve made this past year in various areas of your life \u2014 and that certainly includes progress toward your financial goals. At the same time, you may want to make some end-of-year moves that can close out 2014 on a positive note while paving the way for a productive 2015.<\/p>\n
Here are a few such moves to consider:<\/p>\n
Boost your retirement plan contributions. This actually isn\u2019t an \u201cend-of-year\u201d move because you have until April 15, 2015, to contribute to your Roth or Traditional IRA for the 2014 tax year. Nonetheless, the sooner you get extra dollars working for you in your IRA, the better. You can put in up to $5,500 to your IRA (or $6,500 if you\u2019re 50 or older) for 2014. If you are self-employed, or run a small business, you also have until April 15 to contribute to a retirement account, such as a SEP IRA or a SIMPLE plan. In addition to helping you build resources for retirement, these types of plans can offer you some tax advantages \u2014 so if you haven\u2019t established a retirement plan yet, consult with your financial and tax professionals<\/p>\n
Sell your \u201closers.\u201d If you own investments that have lost value since you purchased them, you can sell them before 2014 ends and use the tax loss to offset some capital gains you may have earned in other investments. If you don\u2019t have any capital gains, you can use up to $3,000 of your tax losses to offset other ordinary income. And for a loss greater than $3,000, you can \u201ccarry over\u201d the excess and deduct it from your taxes in future years. If you still liked the investment that you sold at a loss, and you want to keep it in your portfolio, you could repurchase it, but you\u2019ll have to wait 31 days to avoid violating the IRS\u2019 \u201cwash sale\u201d rules. Keep in mind that these suggestions only apply to investments held outside your employer-sponsored retirement account; you can\u2019t take a tax deduction on capital losses in a 401(k) or similar plan.<\/p>\n
Evaluate your 401(k) investment mix. You may be able to adjust the investment mix in your 401(k) as often as you like. So when evaluating your 401(k), make sure your holdings aren\u2019t concentrated in just a few investments, and try to determine if your portfolio is still appropriate for your risk tolerance \u2014 not too aggressive or too conservative. Also, if your plan offers a \u201cRoth\u201d option, consider taking advantage of it \u2014 with a Roth, you won\u2019t be able to deduct your 401(k) contributions from your taxes, but once you retire, you won\u2019t be taxed on your withdrawals.<\/p>\n
Review your insurance coverage. If you\u2019ve experienced any changes in your life in 2014 \u2014 new spouse, new child, divorce, new job, etc. \u2014 you may need to review your life insurance coverage to make sure that it\u2019s still sufficient for your needs and that you have the correct beneficiaries in place.<\/p>\n
By making these and other moves, you can say a fond farewell to 2014, knowing that you\u2019ve done what you could to help bolster your financial position \u2014 for 2015 and beyond.<\/p>\n
Edward Jones, its employees and financial advisors are not estate planners and cannot provide tax or legal advice. You should consult your estate-planning attorney or qualified tax advisor regarding your situation.<\/p>\n
This article was provided by you local Edward Jones Financial Advisor Greg Burns 15 Lake St., Owego, N.Y. 13827. You can learn more by calling (607) 687-4427.<\/i><\/p>\n","protected":false},"excerpt":{"rendered":"
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