Getting A Head Start For Your 2023 Finances
Article written by Scott M. Kahan in Stroll Chappaqua - December 2022 Magazine
Today, there is information overload regarding finances. But does that help keep you on track to reach your goals? Here is a short list of things to review for the new year that can help put you on track for success.
RETIREMENT SAVINGS — For 2023, the amounts you can fund for retirement accounts such as 401(k) and similar work plans have been increased to $22,500 and an additional $7,500 if you are 50 or older. IRA amounts have also increased to $6,500 and $7,500 if 50 or older. Make sure to review your contributions so that you are maximizing your contributions.
For every financial goal you establish, you need to address the projected cost and the amount of time until your goal is realized.
SPECIAL GOALS — For every financial goal you establish, you need to address the projected cost and the amount of time until your goal is realized. Once you have an emergency fund set aside — at least three months’ expenses — you should put money towards other purposes such as new cars, home renovations and vacations.
Take a look at losses that may help when paying taxes. Losses in taxable accounts can be used to offset gains.
MINIMIZE INCOME TAXES — Look at your year-end income and project what amount of tax you may owe or get back as a refund for 2022. If you will owe, increase your tax withholding or quarterly estimates for the new year. If you are due a refund, adjust tax payments so you get more in each paycheck.
COLLEGE SAVINGS — If you have kids, ensure you are funding a 529 College Savings Plan. If you have grandchildren, it is a great way to help support their future college expenses. Make sure to use the NYSAVES.ORG plan. It is low cost, and as an NYS resident, you can deduct a maximum of $10,000 from your NYS income if married or $5,000 if single.
PORTFOLIO ALLOCATION — If you have not reviewed your allocations recently, now is a good time to realign your portfolio to ensure you are adequately invested in meeting your goals. Take a look at losses that may help when paying taxes. Losses in taxable accounts can be used to offset gains. Any losses not used can be carried forward to future years as well.