HERE’S WHAT’S UP! Conventional wisdom: It’s never too late to do financial planning. Carol’s wisdom: It’s never too early to take care of your money.
REINFORCING THE BASICS.
What is Retirement? Retirement is the withdrawal from an active working life, and for most retirees, for the rest of their lives. Retirement is in no way the same for any two people. No two Retirement Plans will ever be the same. A Retirement Plan requires a Financial Plan and a Financial Plan requires attention and development. We have put a few ideas together that you make an annual New Year Resolution.
FIRST THINGS FIRST.
Have you visited our website lately? We have quite a few Retirement Calculators that are really, really cool. Take a look: Carol’s Calculators
THE NEW YEAR RESOLUTION.
Start Fresh. You don’t have to be a business to have a balance sheet. We have checking and savings accounts and credit card bills. We have cars and car payments; houses and 
mortgages. Some may have an extra house or two and maybe a 401K and the like. Others may have some medical expenses or college tuition. Update this balance sheet. It’s important to know where you are and where you want to be. Make a plan to reduce debts and increase assets and then achieve The Plan.
How much will you spend in 2019? Take a look back at 2018; it’s the best place to start. Throw out one-time expenses like a home improvement or buying an Alexa. Add in reasonably foreseen expenses: an emergency room visit or two; a car repair or two or three; the vet bill when your dog spars with the neighborhood alley cat. You can even budget commuting; the 2019 average gas price is predicted to be $2.70/gallon.
Subscriptions and stuff. Review bank and credit card statements for all the automatic payments and subscription renewals. Are they all current and correct? Are you using all six lines on that cell phone bill? It’s okay to choose between NetFlix and Hulu and Amazon Prime and Tubi and Sling. Check what’s in your phone plan: Sprint has Basic Hulu but AT&T has 30 stations of live streaming.
Update 2019 Form W-4. We are betting a lot of folks didn’t do this in 2018. There’s a good chance that this year’s tax return will let you know whether to increase or decrease withholding.
2019 Withholding Calculator
Workplace Retirement Plan Contributions. We should always be pushing to put more into our retirement. If you pay off a debt or ditch the gym, put the “new” cash in your retirement account. Think about splitting your next raise; keeping some for yourself now and saving some for yourself later. These portfolio(s) are the bulk of your Retirement Plan.
Analyze the Portfolio(s). If you aren’t constantly on your phone checking the portfolio, an annual maintenance check is a good idea. Is the asset allocation still in check with your 
Financial Plan: rebalancing for market volatility and material shifts is fundamental to diversification. Super stereotypical pic, we know.
IRA and HSA Contributions. If you missed these in December, no worries. Eligible 2018 IRA contributions can be made up to April 15, 2019. The lesser of $5,500 or taxable compensation and add a $1,000 if you’re over age 50 and want to catch-up. If you are jumpstarting 2019, the lesser of $6,000 or taxable compensation and add a $1,000 if you’re over age 50 and want to catch-up. If married filing joint and only one income, consider a spousal contribution.
Eligible 2018 HSA contributions can also be made up to April 15, 2019. HSAs have a 2019 contribution limit of $3,450 for single-serve high deductible health plan (HDHP) and $6,900 for a Family-size HDHP. 2018 contributions were limited to $3,425 and $6,850. If you missed our blogs about IRAs, see WHAT ELSE SHOULD I KNOW?
Knock on Roth’s Back Door. Married couples with modified adjusted gross income over $203,000, cannot make direct Roth contributions; single folks, if over $137,000. You don’t have to make a grand entrance, roll on in through the back door. You need to be participating in a 401K that allows, 1: after-tax contributions and 2: an in-service withdrawal of after-tax contributions. Keep in mind that the 2019 limit for 401K contributions is $19,000 for the under 50 crowd and $25,000 for the over 50 crowd. If you still need to make a 2018 contribution: do sore before April 15, 2019 and the limits are $18,500 and $24,500, respectively. Make a non-deductible contribution of the six or seven thousand into a Traditional IRA and then immediately turn around and roll it over into a Roth IRA.
Annual Gift Exclusion. If you missed this in December. Don’t fret. You’re late for 2018 but you can be early for 2019. You can gift up to $15,000 to unlimited people per year without using the Lifetime Estate Tax Exclusion. You won’t even have to pay gift tax.
WHAT ELSE SHOULD I KNOW?
⇒ Individual Retirement Accounts: Traditional & Roth
Reach out to McAtee and Associates for answers and guidance all things tax. Carol would enjoy doing some tax planning and advising with you and assisting you with tax preparation and filing.
[email protected] OR 727-327-1999.
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ANY TAX ADVICE IN THIS COMMUNICATION IS NOT INTENDED OR WRITTEN TO BE USED, AND CANNOT BE USED, BY A CLIENT OR ANY OTHER PERSON OR ENTITY FOR THE PURPOSE OF (i) AVOIDING PENALTIES THAT MAY BE IMPOSED ON ANY TAXPAYER OR (ii) PROMOTING, MARKETING OR RECOMMENDING TO ANOTHER PARTY ANY MATTERS ADDRESSED HEREIN.
