By Elaine C., Assistant Director of Marketing and Guest Blogger
As the holiday season ramps up with decorating, entertaining and last-minute shopping, you may want to consider taking a moment to get your brokerage accounts and investments in order. Before hanging the next decoration, here is a list of items you may want to tackle:
- Review your investment portfolio - Are your investments still enhancing your returns and meeting your strategic needs? A thorough review can help get your portfolio back on track.
- Look for losses to offset realized gains - Investments that have been trailing downward might be worth selling before the end of the year to counter-balance some of your gains. One thing to be aware of is the wash sale rule, which states you can realize the loss for tax purposes only if you do not repurchase a substantially identical security within 30 days before or after the sale. To easily view the gains and losses you have realized this past year, visit the Gain/Loss & Tax Center when you log in to your account.
- Consider maxing out your retirement contributions - If you haven’t already done so, consider contributing up to $5,000 to max out your IRA accounts, or $6,000 if you’re over 50. Your contribution might lead to a valuable tax deduction come next April or help build that sizeable savings you’ll need in retirement.
- Consider an IRA conversion - With lots of discussion in Washington about possible tax rate increases next year, you may want to consider converting your traditional IRA to a Roth IRA to reap the benefits of tax-free growth. You will pay income taxes on the converted funds, so depending on your tax situation, consider converting only a portion of your account.
- Review your beneficiaries - Account succession planning can be one of the most important steps you take with your investments but it is sometimes overlooked. Checking your beneficiaries on a routine basis can help you make sure all your assets, even those held in a Scottrade Bank account, are handled as you wish.
Reviewing your finances and investments this time of the year and getting everything in order is key in helping you be better prepared for the tax season and upcoming year. A checks-and-balances approach can help you to implement an effective investment strategy.
What is on your end-of-year investment to-do list?
Also of Interest:
Elaine joined Scottrade in 2012 as assistant director of marketing.
Scottrade does not provide tax advice. The material provided is for informational purposes only. Please consult your tax, or legal, advisor for questions concerning your personal tax or financial situation.
The strategies described in this blog are for information purposes only and their use does not guarantee a profit. None of the information provided should be considered a recommendation or solicitation to invest in, or liquidate, a particular security or type of security. Investors should fully research any security before making an investment decision.