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Jill On Money: Year end money moves 2024


Taking a cue from the nation’s retailers, let’s start the holiday season before Thanksgiving. Of course, unlike them, I am trying to help you save or make money, not spend it!

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Here are year-end money moves to consider:

Get a jump on taxes
Use the IRS’s Withholding Estimator to ensure that you have set aside enough money to pay your tax bill in April. If not, notify your payroll department to increase your withholding through the end of the year. If you are not working or are self-employed, consider an estimated tax payment to reduce or eliminate potential tax penalties.

Contribute more to a pre-tax retirement plan
If you can afford it, boost your contributions before December 31 – doing so will allow you to reduce your tax bill and save for the future. If your adjusted gross income is $38,250 or less (or $76,500 if married), a retirement contribution might qualify for the Saver’s Credit, worth up to $2,000 for individuals and $4,000 for couples, depending on your income.

Maintain healthy habits
If you have a Health Savings Account, consider topping it off before the end of the year – the 2024 limit is $4,150 per individual and $8,300 per family. If you have a flexible spending account, many plans require you to spend the money before the end of December, or else you lose the money. Check to see if there is a balance and if so, spend it.

Take your Required Minimum Distributions (RMDs)
If you have contributed to a pre-tax retirement account (401(k), 403(b), Traditional IRA), the government requires that you take a certain amount of money from the account after age 73.

Failure to take an RMD results in a 50 percent penalty on the amount you should have taken. (The penalty drops to 10-25%, if you correct it within two years.) If you have multiple IRAs, you only need to take one RMD based on your age and the total value of the accounts. Roth accounts are not subject to RMDs.

Sidestep an RMD with a QCD
Anyone 70½ or older who has an IRA, can make a direct transfer of up to $105,000 ($210,000 if married) to eligible charities. This is called a Qualified Charitable Distribution (QCD) and any amount transferred is not included in your taxable income. For those who are at least 73 years old, QCDs can satisfy RMDs.

Rebalance your investment accounts
With big gains this year, many have asked if they should sell stocks “before the next drop occurs.” Market timing does not work, but now is a great time to make sure your money …read more

Source:: The Mercury News – Entertainment

      

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