The year 2012 is coming to a close, and millions of North Americans are spending their time shopping for the holidays or heading out on year-end vacations, but before you head into vacation mode, don’t forget these six personal finance steps you should consider taking before December 31, courtesy of U.S. News and World Report.
1/ Max out your 401(k) contributions – If there still is room to do so, consider putting additional funds into your retirement savings plan. The maximum contribution for someone 50 and over is $22,500.
2/ Contribute to an IRA – As with 401(k) plans, there is a maximum contribution, but it’s $6,000 if you are 50 or over.
3/ Contribute to your child’s education – There are tax benefits to contributing to your child’s 529 college savings account, so consider putting some funds here before the year is over.
4/ Dump poor investments – If you have under-performing investments, sell them in December and get the tax benefits of the proceeds.
5/ Give to charity- Not only is giving to charity in the spirit of the season, but it can lower your tax bracket as well.
6/ Put money into your mortgage- Many mortgages allow borrowers to contribute an additional amount of money every year into their home, so put some extra savings there if you can.