Every December, I used to tell myself I’d get my finances organized “after the holidays.” Then January would hit, tax deadlines would sneak up on me, and I’d realize I’d missed some easy opportunities to save money or reduce my tax bill.
Last year, I finally sat down in early December and spent about three hours going through everything. That one afternoon saved me around $1,200 in taxes and helped me catch a subscription I’d been paying for a service I hadn’t used in eight months.
Now I have a checklist I run through every year. It’s not exciting stuff, but it works. Here’s what’s actually worth your time before the calendar flips.
1. Max Out Your Retirement Contributions (If You Can)
This one has the biggest impact if you have the cash available. For 2025, you can contribute up to $23,000 to your 401(k), or $30,500 if you’re 50 or older. IRAs have a $7,000 limit ($8,000 if you’re 50+).
I know that sounds like a lot. Most people can’t max out completely, and that’s fine. But if you got a year-end bonus or have some extra savings sitting around, even bumping your contribution by $1,000-2,000 makes a difference.
Here’s why the timing matters: 401(k) contributions need to go in by December 31st. IRA contributions you can actually make until tax day in April, but I prefer knocking it out now while I’m thinking about it. Otherwise, I forget.
Last year, I increased my December 401(k) contribution to grab the full company match I’d been leaving on the table. Free money I’d been ignoring for months because I hadn’t done the math.
2. Review Your Flexible Spending Account
If you have an FSA, most of that money disappears on December 31st. Some plans have a grace period or let you roll over a small amount, but many don’t.
I learned this the hard way three years ago when I lost $400. Now I check my balance in November and schedule any doctor appointments, dental cleanings, or eye exams before year-end if I have money left over.
You can use FSA funds for more than you’d think: prescription sunglasses, physical therapy, certain over-the-counter medications. There are even online FSA stores where you can buy eligible items if you’re scrambling at the last minute. Not ideal, but better than losing the money.
3. Harvest Your Investment Losses
This sounds complicated but it’s actually pretty straightforward. If you have investments that lost value this year, you can sell them to offset gains you made elsewhere. It’s called tax-loss harvesting.
You can write off up to $3,000 in losses against your regular income each year, and carry forward any additional losses to future years. If you made money in the market this year, selling some losers can reduce what you owe in capital gains taxes.
I’m not a tax expert, so I usually spend 20 minutes with my financial advisor in November reviewing what makes sense. One year this saved me about $600 in taxes. Just watch out for the “wash sale” rule—you can’t buy the same investment back within 30 days or the loss doesn’t count.
4. Take Your Required Minimum Distribution
If you’re 73 or older and have a traditional IRA or 401(k), you need to take your required minimum distribution by December 31st. Miss this deadline and the penalty is brutal: 25% of the amount you should have withdrawn.
My dad almost missed this his first year. The brokerage sent notices, but they went to an old email address. Now he has a reminder set for October 1st every year to handle it.
If you don’t need the money right away, you can take the RMD and immediately put it into a taxable investment account or high-yield savings. You have to pay taxes on it either way, but at least it’s still working for you.
5. Review Your Subscriptions and Recurring Charges
This isn’t technically a year-end thing, but December is when I actually do it. Pull up your credit card and bank statements from the last three months and look at every recurring charge.
When I did this last year, I found:
- A gym membership I’d forgotten about ($45/month)
- Two streaming services I barely used ($28/month combined)
- A software trial that converted to a paid subscription ($12/month)
- A magazine subscription I could have sworn I’d canceled ($6/month)
That’s $91 a month, or nearly $1,100 annually. Some of it I reactivated when I actually needed it, but most of it was just waste.
Set a calendar reminder to do this every December. It takes maybe 30 minutes and always finds something.
6. Bundle Your Charitable Donations
If you donate to charity, bunching multiple years of donations into one year can sometimes push you over the standard deduction threshold, making it worth itemizing.
The standard deduction for 2025 is $14,600 for single filers and $29,200 for married couples filing jointly. If your mortgage interest, state taxes, and charitable donations don’t exceed that, you’re taking the standard deduction and donations don’t reduce your tax bill.
But if you donate, say, $3,000 annually to charity, you could donate $6,000 this December to cover this year and next year. Combined with your other deductions, that might push you over the threshold to make itemizing worthwhile.
I started doing this two years ago through a donor-advised fund. Put in $8,000 one year, took the deduction, then distributed it to charities over the next two years. Your CPA can help figure out if this strategy makes sense for you.
7. Check Your Beneficiaries
This is the one nobody wants to think about, but it matters. When’s the last time you checked the beneficiaries on your retirement accounts, life insurance, and bank accounts?
Life changes: marriages, divorces, kids being born, people passing away. Your beneficiary designations override your will, so if you got divorced three years ago but never updated your 401(k) beneficiary, guess who gets that money?
I spent 15 minutes last December logging into all my accounts and updating everything. My son was born two years ago and I’d somehow never added him to my life insurance beneficiaries. That would have been a mess if something happened to me.
Also check that your emergency contact information is current everywhere. It’s boring administrative stuff, but future you will appreciate it.
Making It Happen
Here’s my actual process: I block off a Saturday morning in early December. Make some coffee, pull up all my financial accounts, and work through this list one item at a time.
Some years there’s not much to do. Other years I find several things that need attention. But I never regret spending the time.
The key is doing this in early December, not December 28th when everything’s closed for the holidays and you’re scrambling. Give yourself time to make phone calls, transfer money, or schedule appointments if needed.
One More Thing
If any of this feels overwhelming, pick just two items from this list and do those. Maxing out your retirement match and reviewing subscriptions alone could put hundreds or thousands back in your pocket.
You don’t need to be perfect. You just need to be better than last year.
I used to think year-end financial planning was something only accountants and finance nerds worried about. Turns out, a few hours in December can genuinely change your financial picture for the entire next year. And honestly? Once you get in the habit, it stops feeling like a chore and starts feeling like you’re actually in control of your money.
That’s worth more than any number on a spreadsheet.