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Year-End Financial Check Up
Published Date : December 12, 2013
Much like the annual visit to the doctor’s office, year end is a good time to review the state of your financial health. Here at Sand Hill Global Advisors, we regularly discuss these topics with clients, as they are important reminders to keep you financially fit.
• Year End Tax Planning. Consult your CPA or tax advisor to review your estimated tax liability for the current year. If this happens to be a “big event” tax year (i.e. sold property, large investment gains, etc), this becomes especially important. In addition, inform your Wealth Manager if there were extraordinary events in your life this year that may require tax loss harvesting.
• Review Year to Date Taxes Paid. If you work for a W-2 issuing employer, review your tax withholding to make sure you are not falling into the underpayment penalty category. If you are self employed (freelancer or business owner), pay your estimated taxes! You have until January 15, 2014 to submit your 4th quarter payment. Consult your advisor if you would like to review your tax situation.
• Make Charitable Contributions Before December 31st. To qualify for a charitable deduction, gifts must be made in calendar year 2013. Charitable contributions can be a powerful tax planning tool, but there are many IRS rules regarding how the deduction is applied. For example, in 2013, those over 70 ½ can make a Qualified Charitable Distribution from their IRA directly to a charitable organization (up to $100,000). This distribution would be excluded from your gross income. Discuss your tax situation with an advisor if you plan to make major gifts this year.
• Verify Your Required Minimum Distribution is Satisfied. If you are over 70 ½ and have a retirement account, you are required to distribute a specified amount each year. If you own an Inherited IRA, you may be required to distribute when you are much younger, depending on your situation. Talk to your advisor if you are unsure if this applies to you.
• Consider Gifting to Family and Friends. The gift exclusion amount for 2013 is $14,000 per person (meaning you can gift up to that amount without triggering gift tax). While gifts to other persons are not tax deductible, they can be used to reduce your taxable estate.
• Review Your Insurance Coverage and Beneficiaries. The idea of “insurance” encompasses more than just medical, dental and automobile insurance: consider life insurance and umbrella insurance, as well. If you already have full coverage, review your premiums and coverage amounts with your advisor to see if cost reductions can be implemented. If you had any major changes this past year (bought a new car, got married or divorced, had a child) consider making modifications to your coverage amounts and reviewing your beneficiaries.
• Review Your Estate Plan. Make sure your estate plan is up to date with any changes that took place this year (birth of children or grandchildren, property purchased or sold), and that your designated successor trustees and beneficiaries are still accurate. If you do not have a basic Estate Plan (such as a Last Will and Testament or a Revocable Living Trust), consider setting up a plan to protect yourself, your family and your assets. This becomes especially important if you are married, own property, or have children.
• Create Your Spending Plan for Next Year. Review any major expenses in the coming year. New roof? Wedding to pay for? Child going to college? If you do plan for large withdrawals next year, be sure to incorporate them into your annual spending budget. Planning your budget (and sticking to it) is the best way to ensure you stay financially healthy.
Articles and Commentary
Information provided in written articles are for informational purposes only and should not be considered investment advice. There is a risk of loss from investments in securities, including the risk of loss of principal. The information contained herein reflects Sand Hill Global Advisors' (“SHGA”) views as of the date of publication. Such views are subject to change at any time without notice due to changes in market or economic conditions and may not necessarily come to pass. SHGA does not provide tax or legal advice. To the extent that any material herein concerns tax or legal matters, such information is not intended to be solely relied upon nor used for the purpose of making tax and/or legal decisions without first seeking independent advice from a tax and/or legal professional. SHGA has obtained the information provided herein from various third party sources believed to be reliable but such information is not guaranteed. Certain links in this site connect to other websites maintained by third parties over whom SHGA has no control. SHGA makes no representations as to the accuracy or any other aspect of information contained in other Web Sites. Any forward looking statements or forecasts are based on assumptions and actual results are expected to vary from any such statements or forecasts. No reliance should be placed on any such statements or forecasts when making any investment decision. SHGA is not responsible for the consequences of any decisions or actions taken as a result of information provided in this presentation and does not warrant or guarantee the accuracy or completeness of this information. No part of this material may be (i) copied, photocopied, or duplicated in any form, by any means, or (ii) redistributed without the prior written consent of SHGA.
Video Presentations
All video presentations discuss certain investment products and/or securities and are being provided for informational purposes only, and should not be considered, and is not, investment, financial planning, tax or legal advice; nor is it a recommendation to buy or sell any securities. Investing in securities involves varying degrees of risk, and there can be no assurance that any specific investment will be profitable or suitable for a particular client’s financial situation or risk tolerance. Past performance is not a guarantee of future returns. Individual performance results will vary. The opinions expressed in the video reflect Sand Hill Global Advisor’s (“SHGA”) or Brenda Vingiello’s (as applicable) views as of the date of the video. Such views are subject to change at any point without notice. Any comments, opinions, or recommendations made by any host or other guest not affiliated with SHGA in this video do not necessarily reflect the views of SHGA, and non-SHGA persons appearing in this video do not fall under the supervisory purview of SHGA. You should not treat any opinion expressed by SHGA or Ms. Vingiello as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of general opinion. Nothing presented herein is or is intended to constitute investment advice, and no investment decision should be made based solely on any information provided on this video. There is a risk of loss from an investment in securities, including the risk of loss of principal. Neither SHGA nor Ms. Vingiello guarantees any specific outcome or profit. Any forward-looking statements or forecasts contained in the video are based on assumptions and actual results may vary from any such statements or forecasts. SHGA or one of its employees may have a position in the securities discussed and may purchase or sell such securities from time to time. Some of the information in this video has been obtained from third party sources. While SHGA believes such third-party information is reliable, SHGA does not guarantee its accuracy, timeliness or completeness. SHGA encourages you to consult with a professional financial advisor prior to making any investment decision.
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