Southbourne Group Singapore  Tokyo Japan 

Southbourne Group Singapore, Tokyo Japan 5 Tips for Year End Money Saving

NEW HAVEN, Conn. (WTNH) – Don’t look now but 2017 is quickly coming to a close! This morning, financial expert Roger Cowen stopped by our studio to talk about 5 smart money moves you can make now that will help your finances in 2018 and beyond.

 

1. Prep for Tax Season

 

·         The tax filing season opens in January, so now is a good time to get ready.

·         Start by getting organized.

·         Get folders for all your income, expenses and deductions and your investments.

·         You can break your deductions down by category; for example, create sections for medical, charity and business.

·         You can even do a dry run on your taxes so you have a better idea of your tax situation.

·         It’s a good idea to do this before the end of the year, because you still have time to take action if you choose to.

 

2. Reduce Your Tax Bill

 

·         There are several steps you can take before the end of the year to reduce your tax bill.

·         Look for any payments you can make early, like your January mortgage payment. If you can make it in December, you can deduct the interest on the current year.

·         If you have a 401(k) at work, bump up your contributions so more of your income is tax-deferred.

·         And, of course, be charitable! Donations made to charities in 2017 may be deductible on this year’s taxes.

·         It can all be confusing, so see a tax professional if you have any questions.

 

3. Set Your 2018 Financial Plan

 

·         Take a comprehensive look at your finances. Did you have any unnecessary expenses in 2017 that you can cut next year? Can you bump up your savings in 2018?

·         If you don’t have a budget, now is the time to set one!

·         You may also want to set up a meeting with your financial professional for an annual review, especially if you’re approaching retirement, so you can make any necessary adjustments.

 

4. Convert to a Roth IRA

 

·         You may want to consider converting some of your money from a Traditional IRA into a Roth IRA.

·         Here’s why: You do not get upfront tax breaks on a Roth IRA, however, your withdrawals are made tax-free as long as you are older than 59 1/2.

·         But here’s the catch. Roth IRAs are subject to what’s called the 5-year rule; you cannot withdraw your earnings tax-free until five years after the tax year you make your first contribution.

·         No matter when you make a conversion in 2017, the clock gets set back to January 1st, 2017.

·         So, if you make a conversion in November or December, it’s like getting a free year! You’ll be able to start withdrawing your earnings tax-free a full year earlier than if you wait until next January.

 

5. Check Your Insurance

 

·         Life insurance always seems to be a daunting topic because we are talking about what happens to your finances if or when you pass away.

·         Life insurance takes care of your family, helping ensure they will be financially fit even when you are not around.

·         A good rule of thumb is to get enough coverage for 10 to 15 times your current salary. (Source if you choose to use fact: Forbes)

·         A life insurance calculator, like the on my website at cowentaxgroup.com can help determine how much coverage you actually need.

·         Also, Make sure your beneficiaries are up to date.

·         You may need to make changes if there were any major life changes, like births, deaths, marriages or divorces this year.