As you reflect on 2021 and plan for 2022, it’s a smart time to review your accounts and investments. Beyond shoring up your longer-term financial goals, these efforts can be useful for midterm planning and potentially reduce your tax liability in the coming year.
Whether you’re working or retired, welcoming a new grandchild or building your dream vacation home, it’s essential to continually assess your financial situation, plan and goals. Your Fremont Bank Wealth Management Private Banker can help you consider your options or get answers tailored to your unique circumstances.
To make it as easy as possible, we’ve created this end-of-year checklist based on the most common categories and questions.
- Review your plans, wills and any revocable living trusts with an eye toward any significant transitions or milestones, like births, deaths, marriage, divorce or retirement
- If you haven’t pulled your credit report, remember you are entitled to a free copy from each of the three main bureaus once every 12 months
- Review your year’s spending and saving patterns and set a 2022 budget
- Conduct a family meeting or draft a vision statement to provide clarity
- Set up time to talk with your Fremont Bank Private Banker to discuss any of your questions
Family, Estate and Giving
For 2021 and 2022, did you or do you plan to:
- Make annual exclusion gifts in 2021 to others*
*In 2021, the annual exclusion is $15,000. For 2022, it is $16,000.
- Make a contribution to a 529 or College Savings Plan
- Make gifts to children or grandchildren
- Make any large purchases
- Fund charitable giving**
- Check current debt terms to ensure they’re the most favorable possible
*Contributions must be made by December 21 to count toward your 2021 taxes.
**Donations must be received by December 21 to count toward your 2021 taxes. Donating assets other than cash or donating more can have tax savings implications.
Insurance and Beneficiaries
Before the end of the year, be sure to:
- Review your policies for any changes to health, life and disability insurance coverage
- Update your beneficiaries and designate a successor beneficiary if applicable
- Check that your trustee provided a Crummey Notification to beneficiaries if you have an Irrevocable Life Insurance Trust
- Fund any Roth accounts set up for your children
- Review benefit elections for Social Security and Medicare
Income, Benefits and Retirement
If you are still working, did you in 2021 or do you plan to in 2022:
- Use all your available vacation or personal days
- Use any qualified retirement plans and/or IRAs as best you can*
- Max out your employer-sponsored 401(k) or IRA account contributions
- Contribute, at a minimum, up to any company-matched contributions
- Review your retirement allocations and any corporate stock or incentive options
- Max out any HSA contributions
- Use or roll over any remaining FSA funds and adjusted your withholding as needed
- Reduce your AMT liability
- If you are a business owner or self-employed, reach out to discuss planning specific to your situation
If you are retired, did you in 2021 or do you plan to in 2022:
- Withdraw the Required Minimum Distribution starting April 1 if you turned 72 the year prior**
*For 2021, qualified retirement plan contributions can be up to $19,500 plus an additional $6,500 if you are age 50. For 2022, qualified retirement plan contributions can be up to $20,500 plus an additional $6,500 if you are age 50. 2021 and 2022 IRA contributions are capped at $6,000 plus an additional $1,000 if you are age 50 or older.
**This was not required in 2020 but can not be delayed in 2021. Your Private Banker can help you calculate your 2021 RMB. We can work with you if you’d like to reinvest the proceeds in your taxable account.
Investments & Tax Planning
For 2021 and 2022, did you or do you plan to:
- Recognize capital gains/losses*
- Rebalance your portfolios to match your current situation or priorities
- Exercise stock options
- Defer compensation, property sales or other transactions to lower your tax bill
- Have loss carry-forward from past years
*You can potentially offset taxes on investment gains with capital losses.
This list is by no means exhaustive, but it can be a good start to setting your intentions and plans in motion for a successful 2022. We understand 2021 has been a year of uncertainty for many people, and we want to be there to support your wealth management goals now and in the future. If you want to discuss your plan or strategies or if your priorities or budget has changed, we remain committed to being your financial partner in 2022.
Call your Wealth Management Private Banker or reach out via email to start a conversation about your 2022 wealth management goals.
Seems hyper specific but it was in one of the samples
Is there a form or email they can reach out to? or will they know who their banker is so this should be more "call your person"