6 Money Moves To Make Right Now

Take action before the end of the year to save money and improve your finances for 2019.

Many people wait until the new year—and the annual ritual of New Year’s resolutions—to take stock of their finances. But there are compelling reasons to attend to some financial tasks before December 31. For example, you can still save money on your 2018 taxes, even if you don’t plan to itemize deductions. If you haven’t maxed out your retirement accounts, there’s still time to ask your employer to boost your contributions. And if the new tax law has lowered your tax liability, it may be worthwhile to start converting some money from a traditional IRA to a Roth. Don’t forget timely investing moves, such as selling losing investments to offset capital gains. We have plenty of other suggestions, from health care housekeeping to credit freezing to charitable giving.

Tax Strategies

Check Your Withholding

Employers adjusted workers’ withholding earlier this year to reflect the federal tax overhaul, which reduces tax rates and doubles the standard deduction. But the new law also limits or scraps some popular tax breaks. If you continue to itemize and some of your large deductions have been eliminated, you may not be having enough withheld from your paychecks, which could lead to an unexpected tax bill next April. You are more vulnerable if you live in a high-tax state because the law now caps the deduction for state and local taxes at $10,000.

To find out where you stand, go to www.irs.gov and search for “withholding calculator.” If you discover you’re not having enough withheld, file a new W-4 with your employer. Because there are only a few pay periods left in the year, reducing the number of allowances you claim may not make a big difference in your withholding, says Mark Luscombe, principal analyst for Wolters Kluwer Tax & Accounting. Instead, go to line 6 on the W-4 and fill in the dollar amount you’d like to have withheld.