Financial New Year’s Resolutions: Setting Yourself Up for Success in 2025
As we begin the new year, this is a great time to make a financial new year’s resolution to have a financially successful 2025. A good way to approach this process is to review your 2024 from a financial perspective. What worked well and in what areas can you improve? This is a good time to talk with a financial advisor to get their advice on what you can be doing to help ensure a financially successful 2025. This can include reviewing and updating your financial plan and establishing healthy financial habits for you and your family that focus on your long-term goals. Review and Update Your Financial Plan A financial plan is a key element in achieving financial success. The beginning of the new year is a good time to review your financial plan. Have your financial goals changed? How did you do in 2024 against your planning objectives? The beginning of the year is a good time to revise and update your financial plan and your ongoing strategies. This might include: Are your debt repayment strategies on track? Are you on track with your retirement savings? Are you saving enough for your children’s education? Is your investment portfolio properly allocated? These and a host of other financial resolutions and strategies should be considered at the beginning of the year, based on your goals for the new year and beyond. In addition to reviewing your goals, the critical piece is to implement changes where needed. If you need to be more aggressive in paying down debt, do your best in this area. Reducing debt helps free up funds for other purposes such as saving for other goals. Establish Healthy Financial Habits The beginning of the year is a good time to review your spending and savings habits to help ensure both are on track to allow you to reach your financial goals. If you have not already done this, the beginning of the year is a good time to establish a monthly spending budget. This is a great tool to help you monitor your spending on a monthly basis and to help ensure that it stays within limits you set. This is also a good time to be sure that your savings is automated as well. While you likely have automated your 401(k) deferrals from your salary, be sure that this amount is enough. Beyond savings for retirement, it is a good idea to automate your general savings to be sure you have sufficient cash reserves as well. It can be easy to overspend. This is normal, but it is important to set limits and boundaries on spending. If you reached your monthly spending limit, then it is okay to say any new expenditures will have to wait. This can work if expenditure is something that is “elective” and not a requirement like food or medicine. In some cases, you may find yourself needing to reduce spending in future months. Focus on Long-Term Goals Most of all, it’s critical to review and if needed adjust your strategies to achieve long-term goals, These might include things like: Buying a first or a newer home Saving for your children’s education Achieving an early retirement Travel in the form of several major trips Starting or buying a business Whatever your long-term goals, planning for them as early as possible and reviewing your plans to save for these goals on a regular basis are critical in achieving these long-term goals. Determining if your savings are on track, if you need to adjust your investments or make any other changes along the way is an ongoing process. Setting a strategy and then failing to check in on your progress blinds you from how your investing and savings program is going, and you might find yourself farther behind than is feasible to be able to catch up. Talk with your Wedbush financial advisor. They can help you establish long-term financial planning goals and strategies, and they can help with tracking ongoing spending. Disclosure Wedbush Securities does not provide tax or legal advice. Please consult your tax or legal advisor. These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. The information presented here is not specific to any individual’s personal circumstances. To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances. The information in these materials may change at any time and without notice. Third-party entities, companies, and organizations that may be referenced on this page are not affiliated with Wedbush Securities or any of its affiliates. Opinions mentioned are that of the third-party and not of Wedbush Securities, the financial adviser and/registered representative, or any of our affiliates. Investment products involve investment risks including potential loss and are not insured by any federal agency, are not deposits or obligations of, or guaranteed by any financial institution and may involve loss of value. Past performance is not a guarantee of future returns. Any implementation of recommendations or investment strategies may generate fees, expenses, charges or commissions, based on the products and services. Any organization, company, individual, or third-party entity that are referenced on this page are not affiliated with Wedbush or any of its affiliates. The content on this page might not necessarily reflect the expertise of the investment professional and should be used for informational purposes only; the information provided on this page is not intended to be used as a recommendation of any kind, as it does not constitute an offer or advice. Fixed income securities are
What to Ask Your Financial Planner: Preparing for the 2025 Tax Filing Season
With tax season just around the corner, January is the perfect time to get organized and ensure you’re ready to file efficiently. Discussing the right topics with your financial advisor now can save you time and money later. This can also help ensure that you gather all the information and documentation that you will need to be able to substantiate your return if the IRS should question anything. Also, your Wedbush financial advisor might suggest some things that you have not thought of to flow through your return. Gather Essential Documents It is important to gather all essential documents that will support the numbers entered on your tax return. This includes documentation for income such as: W-2 from your employer 1099-Misc forms from any consulting or freelance clients 1099-B forms for any gains or other income from brokerage or investment accounts Forms from any pension or annuity income you received Income and expenses from a rental property you own Interest and dividend income On the expense side, you will need documentation for: Mortgage interest and local property taxes paid Charitable contributions made Any deductible business expenses Depending upon your unique personal situation, there may be other documentation that you need. This could include any income earned or received as well as documentation of any expenses that you will be deducting. Having proper documentation helps ensure that nothing is omitted from your return and that you can substantiate everything on the return. Your tax professional and/or your financial advisor can offer their expertise in the area. Review Tax Law Changes for 2024 As you prepare for the 2025 tax season for filing 2024 returns, this is a good time to ask your tax professional or financial advisor about any changes in the tax laws that will impact your 2024 return. There are often changes in the limits for contributions to retirement accounts, certain deductions, tax credits and other areas that might impact your personal situation. For example, this is a good time to ensure that you have maxed out contributions to your workplace 401(k). If you are looking to be able maximize your charitable deductions, be sure that you know the limits in terms of your adjusted gross income to allow you to maximize your deductions here. Consider Year-End Tax Moves While reviewing your 2024 tax situation at year-end, consider making some moves if they will help reduce your tax bill. These might include: Charitable contributions, including donating shares of appreciated securities Tax-loss harvesting to offset realized investment gains for the year Ensuring that you have maximized contributions to retirement plans Others unique to your situation based on the advice of your tax professional Plan for Next Year’s Tax Strategy The best time to start planning your tax strategy for the 2025 tax year is right after filing your 2024 return. At this point, the rules and limits for certain types of income and expenses will be fresh in your mind. This is also a good time to give some thought to what might be different in 2025. Will your income be higher or lower? Do you anticipate taking capital gains on stocks or other investments? Will there be a major life change such as getting married or having a child? Will you be getting a promotion or moving to a higher paying position at another employer? Are you in line for a hefty bonus early in 2025 based on your performance in 2024? This is a good time to plan out your retirement plan contributions for the year to ensure that you max them out. Be sure to do 2025 tax planning with your financial advisor early in the year to allow you to make any financial decisions needed to help lower your tax liability. Contact your Wedbush financial advisor to discuss your 2024 and 2025 tax situation. They can help you get organized and plan for the future. Disclosure Wedbush Securities does not provide tax or legal advice. Please consult your tax or legal advisor. These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. The information presented here is not specific to any individual’s personal circumstances. To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances. The information in these materials may change at any time and without notice. Third-party entities, companies, and organizations that may be referenced on this page are not affiliated with Wedbush Securities or any of its affiliates. Opinions mentioned are that of the third-party and not of Wedbush Securities, the financial adviser and/registered representative, or any of our affiliates. Investment products involve investment risks including potential loss and are not insured by any federal agency, are not deposits or obligations of, or guaranteed by any financial institution and may involve loss of value. Past performance is not a guarantee of future returns. Any implementation of recommendations or investment strategies may generate fees, expenses, charges or commissions, based on the products and services. Any organization, company, individual, or third-party entity that are referenced on this page are not affiliated with Wedbush or any of its affiliates. The content on this page might not necessarily reflect the expertise of the investment professional and should be used for informational purposes only; the information provided on this page is not intended to be used as a recommendation of any kind, as it does not constitute an offer or advice. Fixed income securities are subject to increased loss of principal during periods of rising interest rates and are subject to various