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IN THIS ISSUE: End-of-year investing, tax tips, and giving back |
GOOD START
Don’t let sneaky surcharges throw you off your financial plan. Ship holiday gifts no later than these dates1 to pay less. |
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GET IT DONE: 3 MONEY TASKS TO DO BEFORE 2025 |
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1. Book medical appointments and spend FSA or HSA money.Consider seeing your doctors before the end of the year. If you’ve met your insurance plan’s deductible, your insurance starts paying the cost of covered health care services, meaning you could save before the January reset. If there’s money left in your flexible spending account (FSA), spend it on
eligible expenses,
then submit those claims before your employer’s deadline (usually December 31) to get reimbursed. There are some exceptions
to the use-it-or-lose-it rule, however, so check with your employer. Have a health savings account (HSA)? You can use that for eligible expenses too. That cash rolls over every year, so no worries if you don’t spend it all. Psst … here are
6 surprising HSA benefits you might not know. |
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2. Contribute to tax-advantaged accounts.Adding to a workplace retirement account, like a
401(k),
can give pre-tax money a chance to possibly grow over time. Doing so by the end of the year could lower your taxable income for 2024. Some tax-advantaged accounts, such as IRAs
and HSAs,
allow contributions for the past year up until the tax-filing deadline in April. For HSAs, though, waiting until April could mean potentially incurring FICA taxes that could be avoided by contributing through payroll deductions by December 31. Help
snowball your savings with these 8 moves.
3. Try other ways to help reduce your tax bill.You can get into the holiday spirit—and potentially lower your tax liability—with charitable donations. When you donate to an IRS-qualified 501(c)(3) public charity, you may be able to take an income tax deduction. But most donations can only reduce your tax bill if you choose to
itemize your deductions. Generally, you’d itemize when the combined total of your anticipated deductions—including charitable gifts—add up to more than the standard deduction.
Another tax-reducing trick: tax-loss harvesting.
You can sell investments that are down, replace them with reasonably similar investments, and then offset realized investment gains (aka stocks you sold for a profit you’d be taxed on) with those losses. The end result is that less of your money goes to taxes and more may stay invested and working for you. |
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HOW TO
Hit year-end money deadlinesDon’t miss your last chance to tick off these important spending, investing, and tax-related deadlines. |
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QUICK Q
What are some creative ways to give back?Here are a few alternatives to sending a check that still let you support causes you care about.
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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
(as in, donate as much as you do to the same organization, so your dollars go further).
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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. 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.
Short on time? Make a difference in 15 minutes or less. |
