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The end of the year is always a time for reflection, and your personal finances are no exception. Even meyear is marked record high inflationthere is a good chance your finances aren’t as bad as you might think. But as 2022 comes to an end, it’s the perfect time for it conduct a year-end review. Using the buckets below, you can end 2022 on a strong note and head into 2023 with all the necessary adjustments you may need. Here’s your year-end financial checklist.

Maximize your retirement contributions

If you have the funds, you should maximize your pension contributions to maximize savings before the end of the year deadline. Currently, 401(k) participants can contribute up to $20,500 (which was already a $1,000 increase from 2021). For traditional and Roth IRAs, you can withdraw up to $6,000 in 2022.

Good news for big savers next year. starting in January 2023, you’ll be able to contribute $22,500 to your 401(k) plan, a nearly 10% increase in the limit. Additionally, those 50 and older will be able to pay an additional $7,500 for a maximum contribution of $30,000. The IRS is also increasing the contribution limit for traditional and Roth IRAs to $6,500 in 2023 ($500 increase from this year).

Don’t waste your flexible spending dollars

If you have a Flexible Spending Account (FSA), time is running out to use up your remaining balance. Check your employer’s policies that apply any remaining balance on December 31 of this year, so you won’t lose your hard-earned funds.

If you can hardly squeeze in doctor’s appointments throughout the year, either because everywhere is booked months in advance, or because it just seems daunting, fear not. You can spend your remaining FSA funds on qualifying health care expenses. You can use FSA funds to upgrade your prescription glasses or buy more contact lenses. You can also visit your local pharmacy and stock up on some FSA-eligible over-the-counter products, such as first aid kits, popular cold remedies, and even sunscreen. You can find full list in the FSA store here.

The employee health FSA contribution limit will be in 2023 $3050, which is $200 more than the 2022 cap.

Review tax withholdings

Of course, tax day isn’t a few months away. However, now is a good time to review your tax withholdings and payments. If you had a major life event in 2022, such as marriage, divorce or a child,you probably want to adjust your deductions. Check it out Tax Withholding Estimator from the IRS to effectively adjust how much income tax is withheld. Here’s how Inflation can help lower your taxes in 2023.

Update your beneficiaries

As we mentioned above, if you’ve had a major life change, you’ll want to update the beneficiaries of your finances accordingly. Write down the names of everyone on the beneficiary side of your bank accounts, retirement accounts, life insurance policies, and annuities. The end of the year is the best time to take stock of anyone who may have entered or exited your life and needs to be covered (or perhaps removed).

Review your financial goals

Regardless of your current financial situation, it’s important to be honest with yourself. Sit down and physically write down where you can improve the health of your personal finances. Think Do you have a plan to pay off your debt?? Is yours? costs must be contained? Are you saving where you can invest, or? the opposite?

Think about your priorities in the new year. You might consider investing in a financial specialist use as sound advice, as their perspective can be the push you need to create your short-term and long-term financial goals.



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