Adopting a New Year’s Resolution for Financial Strategies

 

Make your 2023 New Year’s resolution a great one! It’s time to line up your long-term financial goals with an effective tax-savings strategy. Now that’s a resolution! As you pull together documentation for filing your tax return, let’s look at a few strategies you can implement that could potentially reduce your stress and future tax obligations.

A Time for Preparation

Evaluating your finances well in advance of tax season will help you better prepare for Tax Day. The key is to start early, especially if you’ve had a major life change like a new home or job. It’s also a good idea to plan if you think you’ll owe taxes or if you qualify for certain tax deductions.

Did you know you can make tax-prep changes to your paycheck leading up to tax season? Periodic assessments of your paycheck withholdings could set up a refund, or even a reduction or elimination of your future tax burden come April.

Turn Investment Losses into Gains

The new year is a great time to review your financial portfolio with your wealth advisor. A wealth advisor will be your guide to evaluating assets that have performed well and assets that have incurred losses. This review can help ensure you are maximizing your investment savings, as well as help estimate your gains and losses.

For example, you might consider avoiding short-term gains, since these are taxed at higher rates. If you are anticipating a short-term gain, offset it with short-term losses or consider holding onto the assets for at least a year (when they become long-term assets).

Stay Organized

Nothing sets you up for success more than knowing your documents are ready to go. You should keep track of your tax and other financial records to avoid delays or frantic preparations as the filing deadline approaches. That includes W-2 forms, canceled checks, certain receipts and previous years’ returns.

Some other helpful items to start gathering are your pay stubs, mortgage payment records, records on charitable giving or donations, medical bills and credit card and bank statements to verify deductions. Find a place to store your tax documents until it is time to prepare to file – early planning may alleviate concerns later as the tax deadline gets closer.

Looking Forward

Proactively planning your financial strategy with your wealth advisor can help you take advantage of the tax opportunities available, all while not breaking a sweat once tax season arrives. QCBN

By Daniel Martinez

For more than 12 years, Daniel Martinez has worked in the financial services industry helping individuals and families align their goals toward financial freedom. He provides clients with a variety of investment knowledge and experience, taking the time to create a personalized financial plan for each client. Martinez is bilingual in English and Spanish. Martinez holds his insurance licenses and is registered through LPL Financial with his SIE, Series 7 and 63 securities registrations. To schedule an appointment with Daniel Martinez, email DMartinez@oneazcu.com or call 928-777-6050.  OneAZ Wealth Management is a team of LPL Financial licensed professionals and support staff located in OneAZ Credit Union branches across Arizona providing investments, insurance and retirement planning services intended to guide credit union members toward their financial goals. To learn more about OneAZ Wealth Management, visit OneAZWealth.com or call 877-566-0517.