Broker Check

Financial New Year Check List

December 23, 2022

As 2022 comes to an end, like everyone, I’m someone who tries to set goals for themself going into the new year. Some of those goals are financial goals. So, if you’re someone looking to do the same for yourself, here is my take on a strategy you can use to do so.

Wrap up 2022

-Assess investing and savings accounts 

-Assess tax situation



   -Capital Gains 

   -Tax Loss Harvesting

Plan for 2023

-Saving and investing goals

   -Routine contributions 



   -Identify what to pay down first 

-Stay diligent

Wrap up 2022

First and foremost, even with a few weeks remaining, we have to wrap up 2022 and take a tally of where we are at currently. To do so, let’s start with assessing any investing and savings accounts we currently have. Taking a look at where we started the year and comparing that to where we are now with regards to balances. Now, with the year the market had, it shouldn’t come as a shock if our balance is lower now than it was in the beginning of the year, nor should this make us panic. In a year like this, it is more important to take note of the quality of our investments. Additionally, have we still been routinely contributing and taking advantage of any dividends that our investments have given us over the year. Doing these two things makes all the difference going forward, even if in the current moment our account balance is down. 

For our savings account, we want to make sure we end 2022 with a healthy emergency fund or a “sleep well at night” fund. For any saving that we want to do outside of that, we want to make sure we took the right steps in contributing to that when we could throughout that year. 

Our final wrap up of 2022 should be to assess where we may be tax wise. Much of the tax forms we need won’t come out until 2023, but doing some preparation work now and just getting an idea of our income, dividends, and capital gains for the year will help when filing taxes comes around. Additionally, we find ourselves in a year where doing some tax loss harvesting is very much a strategy you can implement. This can lessen the tax burden we may have for 2022 so if this strategy suits you, you may potentially be able to use it. 

Now, moving into 2023.

This is where the actual goal setting comes into play. We already know what our situation is right now at the end of 2022. Let’s do what we can in 2023 to be better. 

Set saving and investing goals. That sounds super simple, and that is because it is super simple. Let’s take our current situation and do two things. For one, let’s set what we would ideally like those balances to look like in our saving and investing accounts by the end of the year. And be realistic. 

Now two, this is the more important step. Make a plan to routinely get to this goal. Meaning, tell yourself that every paycheck you’re going to invest  x, or every month you’re going to invest x. And try your hardest to not let off of that. The market can go up or down, so at the end of the year we have no way of telling what the balance of our accounts may be. But if we know that we are staying consistent in routinely contributing to our accounts then at the end of the year we know we are moving in the right direction, even if we don’t hit that ideal number. 

It is important to know some updated contribution limits for 2023 so here they are: 

401K: $22,500 - Catch-up contributions of $7,500

IRA: $6,500 - Catch-up contribution of $1,000

Roth IRA: $6,500 - Catch-up contribution of $1,000

Simple IRA: $15,500 - Catch-up contribution of $3,500

Now, let’s take a look into our debts. This might be the most uncomfortable step because no one likes looking at how much they owe someone else. But, it is incredibly important to look at that number to start the year. Get the balances for every debt we have, also get the duration of those debts and the interest rate. Now organize them any which way you like. I typically organize them in the shortest to longest duration because I want to know what needs to be paid off first then work my way to what I have.

So it can go something like:

Credit Cards - 30 days 

Car Loans - 4 years

Student Loans - 10 years

Mortgage - 30 years

That’s just an example but most of the time that is the shortest to longest duration. Now next to these debts put the total balance, monthly payment, and interest rate. Now that we have all of that we can find a way to pay off our highest balance or highest interest rate loans first, whatever best suits our own lives. For the longer duration debts, we just want to make sure we have a plan to keep up with those monthly payments. Totally listing these out and giving ourselves an idea of how to tackle it can make a big difference in 2023.  

We all set personal goals. I always see that I want to eat better, workout more, spend more time with friends/family, but rarely do I see people set financial goals. Treating your financial goals just like they are other personal goals we set can be life changing. 2023 can be a good first year to do so if you don’t already. And if you do, make 2023 the best year for it.