2023 End of Year Check list

As we close out the year – here are some things to make sure are checked off your list.

• If you have an HSA available, max fund it.

  • A single person can put away $3,850. A family can contribute $7,750 and if you are over 50 you can add another $1,000.

  • Invest the money into your available investments. Don’t leave it in cash. And don’t use it for current medical expenses.

  • Let it grow tax deferred, and later in life you can use it to reimburse yourself for medical expenses tax free.

• Change 401k contributions from pre-tax to Roth 401k.

  • If you have not made the change yet, get it done.

  • Log into your retirement plan and choose “change contribution” or something like that. You should have two boxes, one is pre-tax and one is Roth. Unclick pre-tax and click the Roth.

  • We have numerous videos on our website of why I think the Roth is so important. https://www.jpstudinger.com/videos.

  • You will no longer receive a tax break on your contribution. But I don’t think that’s a big deal. Because all your future retirement distributions from the Roth 401k will be tax free. And that is a very big deal.

• Make sure you are invested in a broad domestic market.

  • This has been a crazy market recovery in that only a small segment of the market recovered in 2023.

  • A group of the largest companies, like Microsoft, Apple, Google, Meta, Tesla, Nvidia, and Amazon set new records while most of the market has barely budged.

  • That could be on the cusp of changing and if so, you’ll want to make sure that you are invested into the “rest of the market”. If we are about to see a broad recovery, you’ll want to participate in that for 2024.

  • So, check your allocation to large cap value, small and mid-caps.

• Fully fund your Roth IRA for 2023.

  • On that related note, make sure you have fully funded your Roth for 2023. Don’t wait till the last minute in April, as you might have missed some early market recovery.

• Know your numbers.

  • Update your net worth statement. You’ll want an accurate December 31 snapshot. Tracking your net worth is a critical component to getting wealthier.

  • Track your spending for 2023. Look at your credit card and bank statements for the year. Categorize your spending, put it into a pie chart, and discuss your spending.

  • Budgets are beautiful things. Don’t think of them as a negative buzz kill that says you can’t have fun anymore. Look at them as an information source that shows you where you spend money, what spending is important to you, and where you could be more efficient.

  • Remember, we get rich by buying things that make us more money. Be sure your budget outlines how much of your income buys things that make you money, vs. how much of your income buys you things that make you poorer.

With those things done, you’ll be poised to start 2024 with a bang and have a fantastic year!