Claudia Buck

Cross off some financial tasks

The holiday countdown has begun. And it’s not only about ticking down the days until the traditional celebrations with family and friends. There’s also another countdown: to some end-of-year financial tasks that are fast approaching.

Here is our Top 5 Things-to-Do list before 2014 comes to a close.

1. Financial gifts

If you’re giving to family or friends with young children, it’s a good time to consider funding a 529 plan. These are tax-advantaged savings accounts for future college costs.

“December is the biggest month for new account openings, as well as contributions. It’s a gifting and holiday mentality. Folks are getting them in before the year ends,” said Keith Bernhardt, vice president of college planning for Fidelity Investments, based in Smithfield, R.I.

Under 529 plans, the account is opened in an adult’s name with the child as beneficiary. When it’s time for qualified college or vocational school costs, the earnings can be withdrawn tax-free.

You can purchase a 529 plan in any state. California’s 529 plan, ScholarShare, lets you choose from 19 investment portfolios, managed by TIAA-CREF. The minimum contribution is $25.

2. Use up FSA/HSA

If you’ve got an FSA or an HSA under your health insurance plan, now’s the time to spend down your accounts or book doctors’ appointments before the calendar flips over to 2015. Even if the funds are not required to be used up by Dec. 31, it could be useful to book that eye doctor or annual physical, if you haven’t already.

In the past, Flexible Spending Accounts, or FSAs, were use-it-or-lose-it accounts, meaning if you didn’t spend the amount you’d set aside from your paycheck, it would disappear at the end of the year. But as of last year, FSA account holders can roll over $500 in unused funds.

Health Savings Accounts, or HSAs, are tax-deferred savings accounts that do let you roll over any or all of your unused funds.

But health care insurance experts say you might as well use up some of the free health care benefits that are newly covered under the federal Affordable Care Act, such as annual physicals or mammograms.

“Have you spent all your dollars? Take advantage of preventative exams and treatments that are covered” under the new federal Affordable Care Act, said Erin Bocherer, spokeswoman for, an online health care insurance site. “The majority of Americans with health care insurance, whether through an employer or purchased (through a health care exchange), are probably getting a little more in benefits. Take the time to evaluate any preventative coverage that you haven’t used this year. ... Make those appointments.”

3. Beef up retirement $$$

Especially if your employer will match your 401(k) contribution, be sure to sock away a little extra into your retirement account, whether it’s a 401(k), an IRA or other retirement savings vehicle.

“You can borrow for college, but you can’t borrow for retirement,” said Fidelity’s Bernhardt. “You need to put retirement front and center. When it comes, absolutely, if there’s any kind of match on the table from your employer, you don’t want to leave free money behind.”

Bernhardt said December is a good opportunity to sit back and assess long-term goals, such as saving for college, retirement and emergencies. “Look back over the course of the year and think: How am I doing? Stay on track, or get back on track,” he advised.

For example, consider setting up automatic deposits into a retirement account, like a 401(k) or IRA. Same with a 529 college savings plan, if you have one for a child in your life.

And if you’re getting closer to some goals – like a child nearing college age, it might be a good time to recalibrate your investment portfolio, he said. For instance, “If college is two to three years away, take a hard look at (your portfolio). It doesn’t make sense to be 100 percent in the stock market. Consider going to things that are safer, less volatile, so you can feel more comfortable that the money will be there when you need it.”

4. Gather up tax stuff

Nobody wants to think about taxes during the holidays, but many mailboxes get filled with year-end financial statements this month, particularly on investments and real estate. That’s why it’s a good idea to corral it all in one place, so it’s easy to find next spring when you’re filing your 2014 taxes.

“Designate a basket, a box, a bag or something for your 2014 taxes, so that when (year-end statements) start coming in, you’ve got a place. When those envelopes with ‘Important Tax Information’ come, drop them in,” said Diane Muller, partner and an enrolled agent with Just Taxes, a Sacramento tax preparation firm.

Doing so will make filing your taxes next year just a little less crazy.

5. Make those charity gifts

If you want a year-end tax deduction for donations to your favorite charities, be sure to get those checks or credit card payments done by Dec. 31. With so many online and mailbox pleas from charitable groups this time of year, it’s easy to lose track of how much you’ve given and to whom.

Muller, the tax preparer, said that every October, before the holidays get too busy, she prints out her yearly charity-donation list, tracking who she’s given to by check or credit card. That way, she doesn’t duplicate or miss someone on her list.

“I have clients who complain they can’t keep track because they get so many (charity solicitations). Especially in December, the letters come in and you can go to your list and be sure that I have already given to them and don’t need to write another check.”

And, she said, keeping a record of charitable donations ensures that you’ll be able to fully deduct them on your 2014 taxes.

Call The Bee’s Claudia Buck at (916) 321-1968 or read her Personal Finance columns at