Financial Planning, Retirement Planning, Tax Planning

The End (of the Year) is Near! (Or How to Start the New Year Without Regrets)

December 03, 2024

By Thomas Beirne III, CFP®
Vice President, Senior Wealth Planning Officer and Business Development Manager
Washington Trust Wealth Management

As the year winds down and our focus turns to holidays and festivities, it’s easy to allow financial planning to slip to the back burner. But the year-end clock is ticking, and the decisions you make before December 31 can significantly impact your financial future. The time is now for a year-end meeting with your wealth advisor.

Here are five questions to ask that can help you wrap up the year with confidence and avoid a financial hangover in the new year.  

1. RMDs: Am I on Track?

If you're required to take required minimum distributions (RMDs) from your retirement accounts, the stakes are high. Missing the deadline can result in a hefty penalty—50% of the amount you should have withdrawn. Ask your advisor:

  • What is my RMD status for this year?
  • What are my options for withdrawing RMDs, and how can I minimize the tax impact?
  • Can I use my RMD to make qualified charitable distributions (QCDs) to a charity of my choice?

2. Beneficiary IRAs: Am I Following the Rules?

If you inherited an IRA, the rules for distributions can vary significantly depending on the type of account. Missteps here could lead to unexpected tax consequences or even penalties. Discuss:

  • What are the distribution rules for my inherited IRA?
  • How can I plan distributions to align with my broader financial goals?

3. Gains and Losses: Am I Leaving Money on the Table?

Tax-loss harvesting and strategic gains realization can help you manage your tax bill effectively, but these strategies must be implemented before the end of the year. Take the time to reflect on your financial events with your advisor:

  • Have I reviewed my realized gains and losses for the year, and should I take additional gains or losses before the year ends?
  • How can I optimize my portfolio for tax efficiency heading into the new year?

4. Charitable Giving: Am I Maximizing My Impact?

Charitable donations can be a powerful tool for reducing your tax liability while supporting causes close to your heart. Consider more advanced giving strategies:

5. Beneficiary Designations: Are They Up to Date?

Life happens—marriages, divorces, births, deaths—and these changes can impact your financial plans. A quick review of your beneficiary designations could prevent heartache and headaches later. Ask:

  • Have there been any changes in my life that require updates to my beneficiary designations?
  • Are my designations aligned with my current wishes and estate plan?

The Clock Is Ticking … and Washington Trust Wealth Management Can Help

Don’t let the year slip away without taking stock of your financial situation. Scheduling time with your Washington Trust Wealth Management wealth advisor today can ensure that you close the year strong and set the stage for a prosperous 2025. Your future self will thank you. 

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This document is intended as a broad overview of some of the services provided to certain types of Washington Trust Wealth Management clients. This material is presented solely for informational purposes, and nothing herein constitutes investment, legal, accounting, actuarial or tax advice. It does not take into account any investor's particular investment objectives, strategies, tax status or investment horizon. Please consult with a financial counselor, an attorney or tax professional regarding your specific financial, legal or tax situation. No recommendation or advice is being given in this presentation as to whether any investment or fund is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors, or markets identified and described were, or will be, profitable.

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