Once Halloween hits, here come the holidays. Before you’re distracted with all the festivities, now is the ideal time for making smart money moves that will set you on a better financial path in 2018.
Catch up: “Max out your 401(k) if possible. You can contribute $18,000 (or $24,000 if over 50). If your employer has a match, make sure you at least maximize the contribution,” says Jeffrey Feinstein, an associate at Lenox Advisors in Manhattan.
Evaluate: Have you met your goals regarding saving, spending, paying down debt? See what you can do by Dec. 31, and make a financial plan for 2018.
Donate highly appreciated securities: Consider giving highly appreciated stocks or mutual funds you’ve owned for more than one year directly to charity. “You’ll do good, avoid paying the capital gains tax you would have owed had you sold the security instead, and get a deduction if you itemize. You can deduct the full market value of the security, as long as you don’t exceed IRS guidelines, which are fairly liberal,” says Eric Meermann, a certified financial planner with Palisades Hudson Financial Group in Stamford, Connecticut.
Consider tax-loss harvesting: By selling positions that are down this year, you can use the losses to reduce up to $3,000 of taxable income. If your total losses surpass $3,000, you can roll over excess losses to offset gains in another year. Says Marques Lang, a business and financial wellness coach with Paradigm Consulting & Coaching in Hood River, Oregon, “If you have losses from a previous year, calculate how they affect your gains or losses from this year.”