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Your 2012 Last-Chance Financial Planning Checklist
As 2012 enters the fourth quarter, what strategies should investors be considering during this election season and the uncertainty to come after November 6th?
Our advice: Do not get caught up trying to speculate on the short-term. Instead, focus on what you can control within your financial plan.
To that end, here is a list of important things to review before year-end.
TAXES
Collect cost-basis information and review realized and unrealized gains/losses for the year DMM's View: Long-term capital gains rates are scheduled to increase from 15% to 20% in 2013. In some cases, it may make sense to seek to realize these gains in 2012 to lock in the lower rate.
Check loss carry-forwards from last year DMM's View: With high capital gains rates coming, these loss carry-forwards will be even more valuable in the future. If you have carry-forwards, it could influence the decision to realize gains in 2012.
Consider having your tax advisor prepare a year-end tax projection DMM's View: If your tax situation is complicated, it is valuable to update your tax projection before the end of the year while we still have the opportunity to take action to change it.
RETIREMENT
Max out your 401(k)/403(b) contributions at $17,000 (under age 50) or $22,500 (age 50 and over) DMM's View: Nothing helps a portfolio grow like adding money to it. With income tax rates also scheduled to increase in 2013, your tax deductions for contributing to these plans are that much more valuable to you. This is especially true if your taxable income is $250,000 or higher. These taxpayers will be subject to additional surtaxes as a part of the Affordable Healthcare Act.
If you do not have a 401(k), contribute money to whatever tax advantaged savings vehicle is available to you. DMM's View: Traditional IRAs, Roth IRAs, SEP IRAs, SIMPLE IRAs... the options can make your head spin. Give us a call and we can help you figure out which is the best fit for you.
If you are retired, don't forget to take your Required Minimum Distributions (RMD) and review your retirement income strategy DMM's View: Missing an RMD comes along with a painful 50% tax penalty that we would all like to avoid. Having a flawed retirement income strategy that has your money running out before you do is a situation that we all MUST avoid.
INVESTMENTS
Review investment goals and strategy DMM's View: Your investment strategy shouldn't change as a function of the direction of the markets. It should change as function of your life circumstances and modified goals. As we near retirement, we all tend to get more conservative. This current bull market is on a 3.5 year run, if your proximity to retirement calls for a shift away from risk, now would be a nice time to take some stock market profits.
Revisit income needs and savings goals DMM's View: How much we save and how much we plan to spend are two of the most significant controls that we have over our financial plans. Often we need a reality check for our spending goals and continuous vigilance to achieve our annual savings targets. | 
