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With Halloween, Thanksgiving, and Christmas rounding the corner, the year will end before we know it. Don’t wait until the last minute to think through your year-end financial planning strategies because NOW is the best time to be proactive. While we always suggest consulting with your tax advisor, below are a few topics we cover with our clients to help ensure they are on track:

Retirement Plan Contributions

  • Are you on pace to max out your 401(k) for the year? The third and fourth quarter is an excellent time to review your 401(k) contributions to ensure you are on pace to max out the contribution limit for 2022 by the end of the year. However, don’t get too hasty. If you max out too soon, you could leave your employer match on the table and miss out on free money.

Tax Planning

  • To balance your tax liability, are you tax-loss harvesting and selling investments at a loss? In a year like we are having, where both equities and fixed income are experiencing losses, there is an opportunity to harvest those tax losses to offset against gains. Suppose you have more capital losses than gains. In that case, you may be able to use up to $3,000 a year to offset ordinary income on federal taxes, and good news, any leftover losses can be carried forward to future tax years to offset income and capital gains down the road. Please refer to your tax advisor or accountant for more information; these strategies may not be relevant in all situations.
Review Beneficiaries
  • Have you had a significant life transition recently, like a divorce? Verifying your beneficiaries have been changed to reflect your wishes is critical. Remember that beneficiaries also need to be confirmed on your life insurance policies.
Charitable Contributions
  • Do you have a desire to help charities aligned with your values? Gifting is a favorite area to review with clients because we help find strategic ways to contribute to their favorite charities while also helping to mitigate income taxes.
    • Consider donating a portion of your Required Minimum Distribution (RMD) as a Qualified Charitable Distribution (QCD) to your charity of choice. The QCD allows you to lower your adjusted gross income while also satisfying your RMD.
    • Consider gifting long-term appreciated securities rather than cash. This strategy can be easily arranged by establishing a donor-advised fund (DAF), a charitable giving account designed to gift assets to meaningful charities of choice. A DAF is an account where assets are deposited, such as highly appreciated stock, and the donor (the client) receives a tax deduction for making those contributions. The DAF can then direct a specific charitable grant amount to a qualified charity of choice (donation). It is a great way to remove highly appreciated stock from a client’s investment portfolio without realizing gains and, in turn, use those assets to make charitable grants through the DAF.

These are just four questions you can proactively think through NOW. We are ready to talk further if you have any questions. Bridgeworth advisor Susan Copeland holds both her CFP® and CDFA® and serves clients by applying her unique background and skillset to help them work through difficult conversations and various life transitions.


This content does not constitute legal, tax, accounting, financial, or investment advice. Any discussion pertaining to taxes in this communication may be part of a promotion or marketing efforts. As provided for in government regulations, advice related to federal taxes that is contained in this communication is not intended or written to be used, and cannot be used, for the purpose of avoiding penalties under the Internal Revenue code. Based on your specific circumstances, you are encouraged to consult with competent legal, tax, accounting, financial, or investment professionals. We do not make any warranties as to the accuracy or completeness of this information, do not endorse any third-party companies, products, or services described here, and take no liability for your use of this information.

The information and material presented in this commentary are for general information only and do not specifically address individual investment objectives, financial situations or the particular needs of any specific person who may receive this commentary. Investing in any security or investment strategies discussed herein may not be suitable for you, and you may want to consult a financial advisor. Nothing in this material constitutes individual investment, legal or tax advice. Investments involve risk, and an investor may incur either profits or losses. Past performance should not be taken as an indication or guarantee of future performance.