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Your end-of-year personal finance report in 5 points

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May 2021 have been a good year for you, at this point it’s almost over. But before you prepare to welcome 2022, it’s important to take a close look at your finances. Here are five essential steps to take before the arrival of the new year.

1. Check your credit report

Your credit report is an overview of your various accounts and loans and their current status. It is important to have an overview of your borrowing situation to make sure that you are up to date on your various payments. But also, checking your credit report could be a good way to quickly spot financial fraud.

Sometimes criminals open credit cards or lines of credit on behalf of consumers and pile up charges against them. You may not find out that you have been a victim of a victim by reading your credit report and seeing an account that you do not recognize.

2. Review your budget

If you budget earlier in the year, your spending may have changed since. Likewise, your income could increase for 2022, which could mean that you will be able to spend a little differently. Now is a good time to take a look at your budget and make sure it’s right. If not, change those numbers accordingly, so that your budget is ready for the new year.

3. Use your FSA

If you’ve put money into a Flexible Spending Account (FSA) for 2021, now is a good time to check your balance. While some FSAs allow you to carry a small amount of money over to the next plan year or give yourself a grace period to use your funds, you may need to spend your balance before December 31 or risk losing it. . See what options you have and if there is money in your account that you need to spend, think about some of the FSA-eligible drugs or supplies you can get, like bandages and some over-the-counter treatments. .

4. See how you fare with pension contributions

If you are saving for retirement in an IRA or 401 (k), your goal may be to maximize your contributions (that is, to contribute the maximum amount allowed for the year by the IRS) or simply to ‘save more than last year. Now is a good time to check your contributions to date and find a way to put more money in your account before the end of the year if you haven’t reached your personal goal yet.

5. Check on your brokerage account

If you have investments in a brokerage account, it’s a good idea to review them every now and then. If you haven’t done it in a while, do it in the coming weeks. You can decide to sell a poor performing stock and use that loss to reduce your 2021 taxes. You can use the capital losses in your portfolio to offset gains on stocks sold at a profit or to offset part of your regular income. You might also want to move some investments for more diversity.

The steps you take at the end of the year could set you up for a financially strong 2022. Try to tackle these elements before the end of 2021. You’ll be thankful you did.


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