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"The future depends on what we do in the present." ~ Mahatma Gandhi

Financial Planning | Your 2019 Financial To-Do List

Contribute to your retirement plan.  In 2019, the yearly contribution limit for a Roth or traditional IRA rises to $6,000; $7,000 for those making “catch-up” contributions.  Income limits are applied to Roth IRAs.  You can contribute up to $19,000 to 401(k), 403(b), and most 457 plans, with $6,000 “catch-up” contributions.1

Make 2018 IRA contributions by April 15, 2019, which is the deadline for filing your 2018 federal return.

Make charitable gifts.  The individual standard deduction rises to $12,000 in 2019, so there will be less incentive to itemize deductions for many taxpayers - but charitable donations are still deductible if they are itemized.  If you plan to gift more than $12,000 to qualified charities and non-profits, remember that a paper trail is important.  Even if you give cash, you need to document it.2  

Open an HSA.  If you are enrolled in a high deductible health plan, you may set up and fund a Health Savings Account (HSA).  You can make fully tax-deductible HSA contributions of up the $3,500 (singles) or $7,000 (families). HSA assets grow tax-deferred, and withdrawals from these accounts are tax-free if used to pay for qualified health care expenses.3

Review your withholding status.  You may have updated it last year when the IRS introduced new withholding tables.  You may want to adjust for 2019 due to any of the following factors:

  • You tend to pay a great deal of income tax each year.
  • You tend to get a big federal tax refund each year.
  • You recently married or divorced.
  • A family member recently passed away.
  • You have a new job, and you are earning much more than you previously did.
  • You have a new job, and you are earning much less than you previously did.
  • You started a business venture or became self-employed.

Practice tax-loss harvesting.  By selling depreciated shares in a taxable investment account, you can offset capital gains or up to $3,000 in regular income ($1,500 is the annual limit for married couples who file separately).4

Review your beneficiaries. Do this especially if you have had any life changes such as marriage, divorce, death of a beneficiary, etc.

Review your credit report.   At www.annualcreditretport.com you get a free copy of your credit report every 12 months.  In today’s world of cyber crimes, it is good to keep an eye on your credit to catch anything that doesn't seem correct right away.

Take your required minimum distribution (RMD).  If you turn 70 1/2 in 2018, you will need to start taking RMDs from your retirement plan.5

Make 13 mortgage payments.  If you have a fixed-rate loan, a lump-sum payment can reduce the principal and total interest paid.

Talk with us or a tax professional today! Focus on being healthy and wealthy in 2019.

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
Citations.
1 - forbes.com/sites/ashleaebeling/2018/11/01/irs-announces-2019-retirement-plan-contribution-limits-for-401ks-and-more [11/1/18]
2 - crainsdetroit.com/philanthropy/what-donors-need-know-about-tax-reform [10/21/18]
3 - kiplinger.com/article/insurance/T027-C001-S003-health-savings-account-limits-for-2019.html [8/28/18]
4 - schwab.com/resource-center/insights/content/reap-benefits-tax-loss-harvesting-to-lower-your-tax-bill [10/7/18]
5 - forbes.com/sites/bobcarlson/2018/10/26/7-ira-strategies-for-year-end-2018/ [10/26/18]

 

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Licensed to sell insurance products in the following states of: PA.

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