The secret to staying on top of deadlines, I learned, was to take my to-do's and actually plot them on a
calendar. Need to write two articles a week? Block the time out on my work calendar, so no one will schedule
meetings with me during that time. (They still do, but that's another story.) Return a call from one of my
dear elderly relatives? Saturday morning while I'm out walking. (She really likes to talk.)
That same trick works for getting your financial life on track--and keeping it there. The myriad tasks associated with maintaining
an organized financial life seem daunting in list form, but more manageable when spread throughout the
In that spirit, here's a calendar that walks you through many common financial jobs and flags important dates for the
year ahead. While some of them are time-sensitive, such as the tax to-do's early this year, many of the
others aren't. You should feel free to tackle those in any order you see fit, or to ignore those that don't
apply to you or that you've already achieved.
See how you're doing:
Are you on track to hit your financial goals? If you're still in accumulation mode, review how much of your
salary you managed to save and invest last year; 15% is a reasonable minimum target, but reach for a higher
percentage if you're a higher-income person/household. If you're retired, review last year's spending rate
to make sure it passes the sniff test of sustainability.
Find your best return on investment: The most successful investors consider their total opportunity sets--including not just
investment opportunities but debt paydown as well. Are you deploying your money into those opportunities
that promise the highest return on your investment? If you have high-interest-rate credit card debt, the
answer is easy; you'd be hard-pressed to out-earn that interest rate by investing in the market. It's also
worth noting that the new tax laws make itemizing your deductions less attractive than claiming the standard
deduction; check with your tax advisor to find out how much of a tax benefit you’re getting from your
mortgage interest. If the answer is not too much, that's an argument for paying more on your mortgage than
your lender requires you to do. For investors with lower-rate mortgages and tax-sheltered investment options
such as 401(k)s to contribute to, it's usually sensible to deploy money into both.
Bump up contribution rates to accommodate new limits: Investors can contribute a bit more to their company retirement plans
in than they did last year: $19,000 for investors younger than 50 and $25,000 for those 50 and older.
Assuming your plan is decent, check your elections to make sure you're contributing as much as you possibly
can. If you have a high income and earn a bonus, just be sure not to run into the high-class problem of
contributing too much too early to earn full matching contributions. While you're at it, consider putting your other investment
contributions--to your IRA, for example--on autopilot via automatic withdrawals from your checking or
savings accounts. That is apt to help your long-term investment results versus waiting until April to make
an IRA contribution, and spreading out your investments help ensure you don't skip that contribution
altogether. Contributing $500 per month will get investors under 50 to the $6,000 per year IRA maximum,
whereas IRA investors over 50 will need to contribute $583 a month to make it to their $7,000 maximum
Jan. 15 is your deadline for paying your estimated taxes for the fourth quarter of NaN if you are
self-employed or retired and don't have taxes withheld from your IRA withdrawals.
Conduct a review of your
investments: If you undertook a portfolio review at the end of NaN, there's no need to go back through
it. But if you haven't checked up on your investments for a while, it's a good time to do so.
Check in with your tax
professional and gather tax documentation on deductible items: Tax day--April 15--will be here before
you know it. That means it's not too early to start gathering your tax-related paperwork (either physical or
virtual)--especially 1099s listing any income or gains your holdings have paid out. The new tax laws take
full effect with the 2019 tax year; while they're likely to simplify tax filing in the long run, they'll
take some adjusting to. Specifically, many fewer taxpayers are expected to itemize their deductions starting
with the 2019 tax year, largely because of the new, higher standard deduction of $12,000 for individuals and
$24,000 for married couples filing jointly. Some taxpayers may benefit from "bunching" their
deductions--saving deductible outlays for a single year to gain critical mass to exceed their standard
Take a good look at
1099s and W-2s: As these documents roll in, take a moment to gather some intelligence from these
numbers before stashing them in a file or copying them onto your tax return. Your 1099 and W-2s provide
valuable information about your earnings and investing habits. If your salary has increased, have you also
increased your savings rate, including your 401(k) contribution? If you receive piddling levels of income
from a number of cash accounts, can you wring a higher level of income from an online savings account? If
your mutual funds made sizable capital gains distributions, would you be better off holding tax-friendly
index funds or ETFs in your taxable account?
Contribute to an IRA for
: April 15 is your deadline for filing your NaN tax return, and it's also your deadline for
funding an IRA for NaN. If you haven't yet made your contribution, it's time to get on the stick. For NaN,
contribution limits are $5,500 for those younger than 50 and $6,500 for people older than 50, but they
increase to $6,000/$7,000 for the tax year. Bear in mind that the backdoor Roth IRA maneuver is alive
and well for investors who earn too much to contribute to a Roth outright (you simply contribute to a
traditional IRA, then convert to a Roth shortly thereafter), but beware of conversions if you have a lot of
traditional IRA assets.
Fund your health
savings account for NaN: You also have until April 15 to make a contribution to a health savings
account if you want your contribution to count for the NaN tax year. For NaN, individuals with self-only
coverage through a high-deductible healthcare plan can contribute $3,450 to an HSA, whereas those with
family high-deductible coverage can contribute $6,900. People older than 55 can contribute an additional
$1,000 to their HSAs. Those thresholds are going up slightly for , to $3,500 for self-only coverage and
$7,000 for family coverage. An HSA can make an excellent ancillary savings vehicle for investors who are
maxing out their contributions to their traditional 401(k)s. Contributions are pretax (or deductible if you
contribute to an HSA on your own) and compound tax-free, and qualified withdrawals are tax-free.
Know what to save and what
to shred: Tax time has a way of reminding us of the shortcomings of our filing systems for financial
paperwork. While the pain of digging around for the documents you need is still fresh, resolve to get
organized. If your file drawer is bulging with old statements, prospectuses, and utility bills from 2003,
it's time to do some culling. Before you start shredding old financial statements and trade confirmations,
make sure that you have documentation regarding your cost basis--or that your financial provider does.
(Mutual fund companies and brokerage firms are now required to maintain cost-basis information, but that
wasn't the case until this decade.)
Your financial providers have probably been badgering you for years about switching over to electronic
delivery of your statements. It's time to take them up on it. After all, each piece of financial
documentation that passes through the mail puts you at greater risk of financial fraud; you're likely paying
extra fees for paper document delivery, too. Before going paperless, make sure that your computer security
is up to snuff and that you can readily retrieve all of the data you rely on using the company website.
Create a master directory: Every household needs a basic document outlining financial accounts, along with the provider
name, account number, URL, and the names of any individuals they work with. You can create a simple
Whatever you do, encrypt your document (or keep it under lock and key) and alert a trusted loved one of its
April 15 is your tax-filing deadline. It's also your deadline to file an extension if you need more time.
Individuals will also need to make their quarterly estimated tax payments by this date. Finally, April 15 is
your deadline to make an IRA or health savings account contribution for the NaN tax year. (See above.)
Assess your emergency
fund: Unexpected expenses can crop up no matter your life stage, making it essential to hold liquid
reserves--apart from your long-term retirement assets--to defray them. For most households, holding three to
six months' worth of living expenses in true cash instruments is a good starting point, though investors who
earn high salaries or have volatile earnings streams will want to hold more.
Assess liquid assets
if retired: Retired people will want to hold even more cash, in case one of their income sources is
disrupted for some reason. Knowing that their near-term income needs are covered can also help retirees ride
out volatile times with their long-term portfolios.
Create or review your investment policy statement: Running your portfolio without an investment policy statement is a little
like trying to build a house without any blueprints. Your IPS needn't be complicated, but it should convey
the basics of what you're trying to achieve: your financial goals and expected duration/completion, your
asset-allocation policy, your criteria for selecting investments, and the specifics of how--and how
often--you'll monitor the whole thing. If you already have an IPS, it's a good time to review it to make sure
that it syncs up with your current situation and reflects your current belief system and investment approach.
Create a retirement
policy statement: Retired people should also craft a document that addresses the specifics of their
spending strategies: their targeted income needs and how much of them will be covered by pensions and Social
Security; their portfolio spending rate and the extent to which it might change over time; and whether
they're using an income-centric, total-return, or blended approach.
Investors who are paying quarterly estimated tax payments will need to have them in by June 15.
Evaluate the viability of
your portfolio and your plan: Midyear is a good time to conduct a portfolio checkup, because you have
time to course-correct if you've gotten off track. Focus on the fundamentals of your plan and your
portfolio, including its asset allocation, whether your savings and spending rates are on track, and salient
changes with your holdings.
Conduct a cost
audit: In addition to checking up on your portfolio plan, it's also worthwhile to periodically assess
the costs you're paying to keep the whole thing running. Because they rarely write a check for financial
services, most investors are tremendously insensitive to the dollars and cents they're forking over for fund
management, trades, and advice. Spend some time reviewing these costs and translating those percentages into
dollars and cents; then see if you can shave them down. Swapping high-cost funds for lower-cost ones is one
of the easiest ways to bring your cost load down; investors can buy broad-market index funds for well under
Conduct a tax
audit: In addition to checking up on your portfolio's direct costs, also conduct an audit of the drag
taxes are exerting on your return. Your NaN tax return can serve as a valuable guide to the tax efficiency
of your portfolio. Are you taking maximum advantage of your tax-sheltered options, including 401(k)s, IRAs,
and HSAs? Have you revisited your decision about whether to make traditional or Roth contributions to your
IRA and company retirement plan? Are aftertax 401(k) contributions a reasonable option for you if you're a
high-income earner who's maxing out the other usual retirement receptacles? If your taxable holdings kicked
off substantial capital gains distributions in years past, see if you can't make some tax-efficient tweaks,
such as switching to index funds and ETFs for your equity exposure and adopting municipal bonds for your
near-term cash needs.
Craft or revisit your
estate plan: Planning for your own disability or mortality isn't pleasant, which is probably why estate
planning falls by the wayside in so many households. Others may assume that estate planning is unnecessary
for them, given that the estate tax exclusion is currently over $11 million per individual. But a basic
estate plan--in which you determine who will inherit your assets, serve as a guardian for your minor
children, and make important decisions on your behalf if you cannot make them yourself--is a must for people
at all life stages and wealth levels. Do-it-yourself estate-planning kits are increasingly easy to come by
and may help you tick some of the boxes if your situation is very straightforward. But many of us have
special situations--special-needs loved ones, our own businesses, or complicated family situations, for
example--that call for a customized estate plan drafted by an attorney.
beneficiary designations: Many investors aren't aware that beneficiary designations for 401(k)s, IRAs,
and other accounts supersede the information they've laid out in their wills. Thus, if you've gone to the
trouble of drafting a will or creating trusts, it's essential that your beneficiary designations sync with
what's in those documents.
Get a plan for your
digital estate: Do you have a plan for your digital footprint--your social media or email accounts, for
example? Most people don't.
Review your long-term-care
plan: Long-term care is another one of those topics that is no fun to think about and, unfortunately,
there are no easy answers about whether to buy insurance or self-fund using your own portfolio. To make an
informed decision, it's helpful to understand the likelihood that you'll need long-term care, the potential
duration, and the costs.
Important date: Investors
who are paying quarterly estimated tax payments will need to have them in by Sept. 15.
Kick college funding into
high gear: Are your children or grandchildren growing by leaps and bounds, yet you haven't given their
college plans more than a nervous thought (or two or three)? If so, it's time to take a hard look at how
you'll pay for it.
Important date: If
you received an extension on your NaN tax return, you must have the return completed and postmarked by Oct.
15 of this year.
Conduct an insurance
review: Most employers offer open enrollment for health insurance at year end, but it's also a good
time to take stock of your other types of insurance.
Watch out for capital
gains payouts: Mutual funds typically distribute capital gains in December, and by November, fund
companies are usually publishing estimates of their impending distributions. At a minimum, you want to avoid
buying a fund just before it makes a distribution.
Be generous: If giving
financial gifts to loved ones is on your to-do list, you can be exceptionally generous without making your
estate susceptible to the gift tax. For , each individual can gift up to $15,000 per person per year
without having to file a gift-tax return, and all but ultrawealthy, ultragenerous people will never pay gift
tax during or after their lifetimes. Year end is also a good time to squeak in charitable contributions that
may lower your tax bill. With the new higher standard deduction amounts that kicked in in NaN, taxpayers
may find it helpful to bunch their itemized deductions into a single year while claiming the standard
deduction the next. Investors who are subject to required minimum distributions can direct their RMDs to
charity via a qualified charitable deduction, thereby reducing their taxable income for the year.
Conduct a year-end
portfolio review: There's no telling how the market--and in turn your investments--will perform in
, but year-end is a good time to check up on your portfolio. If you own investments in your taxable
account that have lost value, selling to generate a tax loss is a way to find a silver lining. The 0%
long-term capital gains rate is also in effect for , so investors whose income puts them under the
thresholds may be able to engage in tax-gain harvesting. And investors at all income levels can improve
their portfolios by repositioning within their tax-sheltered accounts, where they'll pay no taxes following
changes as long as the money stays inside the account.
Take your required
minimum distributions: If you're post age 70 1/2, you know the drill: Dec. 31 is your deadline for
taking required minimum distributions from your tax-deferred accounts, such as IRAs and 401(k)s. Affluent
retirees love to hate their RMDs, but I always recommend that retirees trim their distributions from
holdings they wanted to prune anyway--positions that have grown too large, for example, or funds and stocks
that have outlived their usefulness. If you're in the enviable position of not needing your RMDs to live on,
consider steering a portion of the distribution, up to $100,000, to charity via the qualified charitable
Dec. 31 isn't just New Year's Eve, it's also your deadline for a number of financial to-do's, such as 401(k)
contributions. Investors who are required to take minimum distributions from traditional IRAs and 401(k)s
will need to do so by Dec. 31, too.