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IN THIS ISSUE: End-of-year investing, tax tips, and giving back on a budget |
GET IT DONE: 4 MONEY TASKS BEFORE 2026 |
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1. Book health care appointments and spend FSA money.Once you’ve met your health plan’s deductible, your insurer starts chipping in on covered health care services. That could mean savings if you get care before the plan-year reset, which is January for many. Spend leftover money in your flexible spending account (FSA) on
eligible expenses,
then submit those claims before your employer’s deadline to get reimbursed—or risk losing the money. There are some exceptions to the use-it-or-lose-it rule, so check with your employer. |
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Have a health savings account (HSA)? You can use that for eligible expenses too. That cash rolls over every year, and you don’t forfeit it if you leave your current job, so no worries if you don’t spend it all by year’s end. You might also consider investing some of it—here are some tips to help you to decide. |
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2. Contribute to tax-advantaged accounts.You could reduce your taxable income—and save for retirement—by putting money in an eligible retirement account before the end of the year. Most accounts, like 401(k)s and 403(b)s, have a year-end deadline. Other account types, such as
IRAs and
HSAs, allow contributions up to the
annual limit until the tax-filing deadline of the following year. (Read: You have until April 2026 to add money for tax year 2025.) However, for HSAs, waiting until April could mean contributing money outside of payroll deductions, potentially incurring FICA taxes that could have otherwise been avoided if the contribution had been made through payroll deductions by December 31 of the previous year.
If you’re also saving for education, keep those deadlines in mind too. Some states’ 529 plan accounts have a year-end deadline to get state tax breaks. Check your 529 plan documents for more information. |
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3. Consider deferring payouts and payments.If you sold a house, collected severance from a job after a layoff, or sold anything of value where you expect a taxable gain, you could ask to receive payments next year instead. That could be a worthwhile request if the additional income would push you into a higher 2025 tax bracket—or you expect to be in a lower tax bracket in 2026.
Similarly, if you plan to sell stock for a profit, you could split the sale over 2 years if the full amount would push you into another tax bracket or subject you to the net investment income tax (NIIT). That’s an additional tax of 3.8% on top of capital gains taxes or ordinary income taxes for single filers with a modified adjusted gross income (MAGI) above $200,000 and couples filing jointly with a MAGI over $250,000. Learn
8 ways to stop tax bracket creep. |
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4. Check work benefits.If your employer reimburses you for a portion of wellness-, phone-, or tech-related expenses—or for school tuition or student loan payments—you may need to claim benefits before the end of the year to get paid back. Just know some of these benefits may need to be reported as taxable income on your tax return. Consider checking with a tax professional for guidance. |
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HOW TO
Save money on 2025 taxesThere’s still time to make moves that could help reduce your tax bill. |
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QUICK Q
What are some creative ways to give back?Here are a few alternatives to sending a check.
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Sign up to volunteer. Think: packing produce at a local food bank or organizing an office toy drive. Search your favorite nonprofit’s website for upcoming opportunities and ideas. Your employer might also organize volunteer opportunities or match donations.
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Consider giving through a donor-advised fund. It’s like a charitable investment account sponsored by a public charity (such as Fidelity Charitable®) for the sole purpose of giving back to your favorite charities. You can donate cash, stocks, and more to potentially qualify for tax savings and invest the account for potential growth.
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Offer a service. If you have a special skill (maybe proofreading, event planning, or graphic design), it could come in handy to a charitable organization. Reach out about lending your expertise.
Psst … do you know these 3 big changes coming to charitable giving due to new tax laws? |
