Here’s Your Year-End Financial Checklist

The approaching year-end offers a great time to reflect on 2014 and look forward to 2015.

It’s a good time to get organized and give some consideration to your finances. There are always changes that might be worth making to better your overall situation.

Budget

Take a look at your spending pattern for the year.

  • Did you stick to your budget?
  • Were there unanticipated expenses?
  • Did you meet your savings goal?
  • Are there areas where you can cut costs or increase your spending?
  • Where do you need to make refinements?

Review your plans and goals and establish a new budget for next year.

Related: Budgets, cashflow, and spending. Yawn.

Investments

Arrange a meeting with your financial advisor. Prepare for it by creating a list of topics to help you get the most out of your discussion.

Review your progress on your financial goals to ensure you are on the right track.

Review and rebalance your portfolio, adjust your current asset allocation as required and ensure your strategy still aligns with your financial goals.

Did you make the maximum allowable contribution to your RESP and TFSA (or as much as you had planned)?

If you turned (or are turning 71) this year make arrangements to switch your RRSP over to a RRIF or annuity before year-end.

If you are using the bucket approach to manage your income stream during retirement, it’s time to think about how you’ll top up your liquid pool of assets.

Taxes

Create your tax file now.

  • Out of pocket health-care costs.
  • Plan your charitable donations.
  • Organize receipts for tax credits and deductions such as transit fares and children’s art and fitness programs.
  • Self-employment expenses

Here’s a checklist: www.hrblock.ca/documents/tax-return-document-checklist.pdf

Realize capital gains and losses. To maximize tax advantages, use capital losses to offset capital gains, first this year, then any three preceding years or any future year.

Related: How to calculate capital gains and adjusted cost base

Employee benefits

Review your employee benefits. If you have “flex” spending for medical and dental expenses make an appointment to take care of your medical needs before they expire. Some plans can carry over from year to year, but others do not.

Understand the choices you’ve made and make sure you’re getting the full use of any benefits you are eligible for. You might want to renew your prescriptions. Some deductibles reset at the beginning of the New Year.

If you didn’t take all your vacation days this year, check with your HR department to see if you can roll them over into the next year. If not, take them now, or cash them out instead. Put this extra money aside to spend on upcoming vacation plans.

Other

Some people like to calculate their net worth at year-end. This lets you know what you need to focus on in the next year, such as increasing your savings or a more speedy pay-down of your debts.

Check your credit score or request a free credit report from www.equifax.com or www.transunion.com.   Make sure there are no mistakes.

Evaluate your insurance policies – auto, home, health, life – to make sure you’re getting the coverage and service your need.

Related: Naming an RRSP beneficiary

Is your beneficiary information updated and correct?

Conclusion

If your year-end review shows you’ve got things under control, congratulations. If you need to make changes, start putting together your plan for next year.

Checking these items off your to-do list can help you be more organized and give you a sense of accomplishment. You’ll feel in great financial control, which should help you enjoy the holidays even more – a good end to the year.

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