Community Bankers of Iowa Monthly Banker Update November 2013 | Página 16

Consumer Tips From the Community Bankers of Iowa
End-of-Year Financial Planning Tips
As the end of the year approaches, most people’s focus tends
to shift toward the excitement of the holidays and away from the
responsibilities of financial planning. Yet the end of the calendar
year provides important opportunities to make adjustments for
tax and retirement planning. The following tips can help you take
advantage of those opportunities and plan responsibly for the
year, and years, ahead.
Plan Your Charitable Donations
Whether it’s the box of stuff in your garage or the old car in your
driveway, making charitable donations before the end of the
year can help reduce your tax liability. Make sure to document
the items being donated and ask the charity of your choice for a
receipt.
Talk to Your Financial Advisor
If you own stocks or other investment instruments outside of
your 401(k), now is the time to talk to your financial advisor to
review your investment portfolio. By taking losses on certain investments now, you could affect your overall tax bill. Don’t have
a financial advisor? Your local community bank can likely help
point you in the right direction.
Dust Off Your Family Budget
Add a re-commitment to budgeting to your family checklist for
the end of the year. Whether it’s reining in your family expenses
or setting up an automatic deduction from your paycheck to pad
your savings account, making a plan and sticking to it is the surest path to financial success.

Make an Early Mortgage Payment
If you can make your January mortgage payment before December 31, it will allow you to deduct the interest paid on your
tax-year 2013 taxes, lowering your total taxable income.
Max Out Your IRA Contributions
For 2013, the maximum you can contribute to your traditional
and Roth IRAs is the smaller of $5,500 ($6,500 if you’re age 50
or older) or your taxable income for the year. While you technically have until April 15, 2014 to max out your contributions for
the 2013 tax year, now is a good time to make sure you have a
plan to do so.
Take Full Advantage of Higher Education Tax Credits
If you are currently enrolled in college or are paying for a dependent’s education, you may be eligible for the American opportunity or lifetime learning tax credit. The American opportunity
credit provides up to $2,500, but is limited to use in a total of four
tax years. The lifetime learning tax credit provides up to $2,000
in tax credits for qualified education expenses, including tuition,
books, supplies and equipment. Both credits provide incentives
to bundle your education expenses before the end of the year to
take full advantage of tax savings.
By knowing—and taking advantage of—a few tips that will
provide various tax saving and retirement planning opportunities, you can rest assured your finances are in the best possible
condition moving into 2014.

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