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5 Items to Mark as Done on Your Year-End Financial Checklist



It’s hard to believe we’re so close to the end of 2022. Literally everyone I’ve talked to recently has said the year has flown by in the blink of an eye. Maybe that’s because after nearly two years of slowing down because of the pandemic, our lives again resemble the “normalcy” of those pre-pandemic times.


While things might feel incredibly busy, if not a little overwhelming, it’s still a great time of year to check off some items from your financial “to do” list. So much the better if those items are low effort and easy to get done. And like any project that may be hard to start, if you can make the time to get just one of these checked off your list, you might just find the motivation to keep going!


#1 Maximize Your Savings Rate


While paying so much more for essential items like food and gas this year hasn’t felt great, there is a silver lining to inflation. As the Fed has steadily increased interest rates, many banks and credit unions have, too.


As for how much to save and where, as a rule, it’s a good idea to keep three to months of expenses (rather than your earned income) in a savings account that’s set up to auto transfer to your checking account if you overdraw it.


When you’re able to save cash over and above your emergency fund, consider saving to a high-yield or certificate of deposit (CD) account that can earn more interest than a traditional savings account. You can set up a monthly auto transfer from your paycheck or your checking account to the account. And because it won’t be as easy to access the money you’ve saved, you’re more likely to “set it and forget it.”


To get in the habit of saving more, follow the “50/50 savings rule” I talk about in a recent blog post. Anytime you receive a raise, bonus or some other influx of income, save half right away, and enjoy the other half. It’s a great way to put your savings first but still enjoy your hard work.


How to Find the Best Savings Rate


Visit a website like bankrate.com to compare the deposit rate you’re earning at your current bank or credit union against others, which may or may not be keeping up.


Savings Accounts with Online-Only Banks

Online-only banks like Ally and Synchrony and large banks offering online savings accounts like Citizens and Citibank tend to offer higher rates if you maintain a minimum account balance. High-yield savings and CD accounts can offer even higher rates if you don’t need to access your money in the short-term.


Bank Certificates of Deposit (CDs)

A CD requires you to keep your deposit in the account for a set time period.

· According to Bankrate.com, at the end of November, the banks offering the best CD rates are offering an annual percentage yield (APY) of between 3.5% to 4.75%, depending on the time period.

· Make sure you won’t need to access the money before the end of the term though, so you aren’t hit with an expensive early withdrawal penalty.


High-Yield Savings Accounts

High-yield savings accounts can help you earn a more competitive APY than the yield on a traditional savings account. These banks might charge a fee and limit how many times you can transfer or withdrawal the money, so make sure to review the fine print before moving money into one of these.

· According to Bankrate.com, as of the end of November, the highest yield from banks were between 3.25% to 3.91%.


#2 Find Out if You Have Unclaimed Assets


It takes less than five minutes to find out if you have unclaimed assets from previous employer retirement plans, inactive stock or brokerage accounts, uncashed checks and more. According to the website https://www.missingmoney.com, one in seven people have unclaimed property and the average claim is a $2,080 value.


A recent search I complete for my husband and myself netted us almost $500 from an old checking account, a credit card refund and solar refunds. While it wasn’t life changing, I found it extremely satisfying to get that money back. Filing a claim for each of us only took ten minutes, so I found it to be a valuable use of my time. 😉


#3 Cancel Your Unused or Underutilized Memberships and Subscriptions


It’s easier than ever to sign up for memberships or subscriptions online—and then to forget about them. Gym memberships, massages, streaming services, smart phone apps, software services and even things like vitamin and razor subscriptions can really add up.

  • The first step is to take ten minutes to review a full year’s worth of bank and credit card statements to find what recurring monthly and annual charges you’re paying.

  • From there you can log in to the corresponding website to cancel your account. Some companies make it easy to cancel, but others don’t and bury the details on their website.

  • Googling “how to cancel my Gym Name membership” can sometimes take you to the right page.

  • There are also bill-tracking and budgeting services like Rocket Money and Trim or online legal services like DoNotPay that can help you cancel your subscriptions, but they likely won’t be able to handle all of them.

This activity might take some time depending on how many random charges you have, but doing so a few years ago saved me and my husband more than $600 a year (!). Having gone through all the tedium, we’re now much less likely to sign up for something with a recurring charge.

#4 Increase Your Investment Savings


Every year, you should consider increasing your investment savings. Even a two or three percent increase can make a big difference in the long run through the power of compound interest.


As a start, make sure you’re contributing enough to maximize the amount of any match offered by your employer to your retirement savings. At the end of year, it’s always a good practice to bump up your contribution, especially if you got a raise and didn’t make that change based on the 50/50 savings rule above.


Once your cash flow allows, aim to maximize your retirement savings contributions. For 2023, the max contributions for retirements account have increased:

  • Roth and traditional IRAs are $6,500 and $7,500 with the over age 50 catch up

  • 401ks/457s are $22,500 and $30,000 with the catch up

  • SEP IRAs are $66,000

  • SIMPLE IRAs are $15,500

  • Health savings accounts are $3,850 or $4,850 with the over age 55 catch up, and $7,750 or $8,750 for a family

Finally, if you’ve been able to maximize your retirement savings contributions, you can add extra money to a taxable investment account. You’ll just have to pay taxes each year on any short- or long-term capital gains within the account.


#5 Add to or Make a Gift to a Loved Ones’ 529 Savings Plan


Few would argue that savings for a child, grandchild or other relative’s future education isn’t a smart investment. But it can be easy to forget to contribute to an existing account if you don’t have automatic contributions set up or it’s for your grandchild or relative.


In Colorado, taxpayers are allowed to deduct their 529 and ABLE plan contributions from their Colorado state income tax return calculation (but not Federal). For 2022, the deduction is limited to $20,000 per taxpayer, per beneficiary for single filers, or $30,000 per tax filing, per beneficiary for joint tax return filers.


As an example, if you’re married and have two children, you can contribute and deduct up to $40,000 from the combined income amount used to calculate your state income tax. There are additional rules to be aware of when adding to a college savings fund such as gift tax, so talk to a financial planner or do the research if you want to contribute a bigger chunk of change. The Saving for College website has good information on this topic.


From there, the earnings in the savings plan grow tax-free. When the funds are used for eligible education expenses like tuition and fees, room and board, books, supplies, computers and printers, internet access and more the distributions are also tax-free.


Ready to Make Your (Check) List and Check it Twice?


Hopefully you’ll find some time during this holiday season to mark some of these items off your to do list. I always feel a sense of accomplishment when I check that box, and know you will too!


Feeling really motivated? Download my comprehensive end-of-year checklist for even more financial actions you can take this year (and every year) to keep on top of your money.


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