Three Tips for Year-End Financial Planning

DMI | Financial planning, taxes

2020 is officially wrapping up. From market volatility to global challenges like the COVID-19 pandemic, this year has been full of ups and downs. It’s more important than ever to ensure your financial planning is in order. As you support your clients during a challenging year, these are some things you should remind them as part of a year-end financial checklist.

1. Take The Required Minimum Distribution (RMD)

The required minimum distribution is the minimum amount they must withdraw from their account each year. The RMD rules apply to all employer-sponsored retirement plans, which includes:

  • Traditional IRAs
  • SEP IRAs
  • 401(k) plans
  • 403(b) plans
  • 457(b) plans
  • Profit-sharing plans
  • Other defined contribution plans

Have a conversation with your clients, and remind them of any RMD minimums on their accounts.

2. Review 401k and IRA Contributions

Capitalizing on contributions each year should be part of a financial planning checklist. Contributing correctly to retirement savings accounts helps your clients reach their financial goals efficiently and can impact tax planning. Take some time to review your client’s contribution limits with them, and discuss their financial plans to ensure they’re making the most of their contributions.

3. Prepare for the April 15th IRS Deadline

December always seems to fly by with the holidays, and the tax deadline tends to sneak up on us. Help your client start getting organized by reminding them to collect their tax slips and any receipts they might need for tax write-offs now. This helps streamline the process, and improves the client’s satisfaction in your service. The earlier you can get started, the less stress there will be closer to the deadline.

The year-end financial planning can be a smooth process that gives clients confidence in their finances with a little preparation and proactivity. Give them the support they need, and provide them with peace of mind knowing that they’re starting the new year off on the right foot!

DMI is proud to support financial advisors as they help business owners achieve their financial goals. Reach out to us at (866) 322-3684 to get started!  Visit our website for more information on our offerings and check out our blog for additional topics to support clients.