Between shopping and Christmas parties, we still have to squeeze in a little time for end-of-year portfolio housekeeping.
In my view, it’s particularly important to take a good look at your 401(k) plan this time of year.
Here’s a quick to-do list of moves you need to make in your 401(k) plan before the end of the year.
If you’re wanting to get the maximum tax break for this year, you have to act now.
So, if you haven’t contributed the full $18,500 this year (or $24,500 if you’re 50 or older), this is your last chance to do it.
Talk to your company HR department now and ask them to put 100% of your next paycheck into your 401(k) plan, if that is feasible for you.
Market technicians may quibble on the details, but the bull market that started in 2009 is considered by many to be the longest in history.
If you don’t look at your allocation all that often, you should give it a look.
After nearly a decade of stock market gains, it’s possible that you have a lot more exposure to stocks than you want or need. Take this time to rebalance your portfolio to an allocation that is appropriate for you at this age and stage of life.
In 2019, the maximum you can contribute (not including employer matching) increases from $18,500 to $19,000.
And if you’re 50 or older, it gets bumped from $24,500 to $25,000.
If you’re like most Americans, your retirement plans are probably a disorganized mess. You also might a half dozen older plans from previous jobs.
The more plans you have, the harder it is to keep track of them all. Do yourself a favor and consolidate them. I will likely take no more than 10 minutes on the phone with your old employer’s 401(k) administrator to make it happen.
I’ve been married for 10 years and have two children. Yet I discovered in horror two years ago that I still had my sister listed as my primary beneficiary on one of my larger retirement accounts.
Had I gotten hit by a bus, that would have been a very awkward mess for my poor wife and sister to sort out.
So, be smart and check your 401(k) beneficiary designations, particularly if you’ve had any major changes such as a marriage, birth of a child or a divorce.
- Sizemore Capital Management LLC is a registered investment advisory firm located in Dallas, Texas. Charles Lewis Sizemore, CFA is the founder and Chief Investment Officer of the firm.