As 2015 winds down you may start to think about 2016 and a better way to focus on finances. You do not have to wait for January 1st to act. If you start now, you could save when it comes to April taxes, a greater contribution to retirement accounts, or even pay down that debt that has been staring you in the face this year. You could start your plan now and start 2016 ahead of the game.
Take a Look at Your Portfolio
I find myself guilty of this and just read the bottom line percentage increase on the quarterly statement but experts suggest that this is the time of year to take a look at your investments and see where each are performing and rebalance your portfolio, especially with the stock market being as volatile as it has recently. Rebalancing is the process of buying and selling portions of your portfolio in order to set the weight of each asset class back to its original state as you can find by the end of year that each asset class in your portfolio has changed due to earning a different return. Rebalancing allows the chance to minimalize and keep risk in check.
Max Out Retirement Accounts
With the option of contributing to 401k up to $18,000 if under 50 years old, $24,000 if you are over, there is still a couple more months of paychecks coming before the end of the year to contribute more to increase savings rate. Another option is contributing to a Roth IRA which you can contribute up to $5,500 a year, or $6,500 if over 50 years old. The great pro about a Roth IRA is that the money grows tax-free, and as long as it has been there for at least five years, will not have to pay taxes when you start to take out in retirement.
Take a Look at Credit Reports
With a free copy of your credit report available to you every 12 months from Equifax, TransUnion and Experian. It is not a secret what is on your report, so make sure it is accurate. The free credit report does not come with a credit score, however, with credit card monthly statements now showing your credit score, you will be able to now know your detailed report and score prior to any large expenses, or even just for peace of mind.