4th Quarter Financial Checklist

As we approach the end of 2019 (hard to believe!), the team at Marzano Capital Group wants to put emphasis on a handful of important items when it comes to personal finance. Together, we feel that reviewing the 5 bullet points below with a team of financial professionals can add value to your overall situation:

  1. Benefit Changes at Work: The window for open enrollment and work place benefits typically lands on November 1st of each year. It is important to know what changes may be affect your healthcare coverage and retirement plan benefits (401(k), 403(b), SIMPLE IRA, etc.). Employers may change certain aspects to your healthcare insurance or retirement plan, so please do not gloss over those. Always get a second opinion if you are unsure!

Many employers also offer life and disability insurance during these open enrollment windows. If you had a life change during of 2019; such as the birth of a child, new purchase of a home/property, or changes in income, it could be beneficial to add some coverage through your employer as premiums can be very reasonable.

  1. Beneficiary Review: Performing a beneficiary review on your financial accounts is always a great idea! In the event something unexpected were to happen to you, it is important that your assets transfer to the ones you currently intend them to go to.  Make sure your retirement plan at work, additional investment accounts, bank accounts, and life insurance have the proper information listed under beneficiary designations.

We recommend performing this review every year. If you are unsure how to review your listed beneficiaries, please reach out to a financial advisor.   They should be able to point you in the right direction! 

  1. Be Aware of Gains and Losses: As an investor, you should be cognizant about how much you have realized in gains and/or losses inside your non-retirement investment accounts. It is a financial advisor’s job to help try and grow your assets but it is also important to be prepared for any taxable consequences at tax time.  Know that measures may be taken in certain cases to try to achieve this in a more tax-efficient manner. Ask your financial advisor about your realized gains and losses as you prepare for year-end. 

Now is also a good time to involve your tax-professional. Allow you financial advisor and tax-professional to work as a team in an effort to make sure that you aren’t caught with any surprises come tax time!

  1. Required Minimum Distributions: If you turned age 70 ½ during 2019, you are now considered Required Minimum Distribution stage per the IRS. This means you are required to take dollars out of your retirement accounts (IRAs, 401(k)’s, 403(b)’s etc.) this year and every year moving forward. Please make sure you do not overlook this, as the penalty can be rather steep if you do not take your RMD. Your investment team should help you keep up with this.  It may be time, at this stage, to consider consolidating your IRAs at one custodian to help keep up with what amount you must withdraw.

Another topic that investors should consider as it relates to Required Minimum Distributions is charitable giving. Take time to speak with your financial advisor and tax-professional about Qualified Charitable Distributions (also known as QCDs). They should be able to determine if this is an appropriate option for you and/or your spouse.  Doing a QCD can help fulfill your duties to take money from your IRA by donating it directly to charity and eliminate the 1099 on the donated amount.

  1. Access Risk: Last but certainly not least, please take time during your year-end portfolio review to ask your investment professional about the risk level of your investments. Your team of investment professionals should utilize tools that clearly articulate this to you. It is important to know roughly how much downside and upside you can expect in different market conditions.

These items certainly do not cover everything, but they are a great starting point!  At Marzano Capital Group, we feel this article can serve as a great financial outline for a successful 4th quarter. It is important to be holistic in your planning.  Having a great team of professionals behind you can build confidence that you are continually keeping track of what needs updating and monitoring. Have a great end of your year!

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