098: End of year planning -Max out retirement plan contributions
We are finally in the last month of 2016! I am not saying it from a sad note! I’ve had a very prosperous year personally & professionally and I am very much looking forward to 2017. In the remaining time we have left this year let’s focus on what we can still fix about our finances to come out in the winning position.
Maximize retirement plan contributions – most of us have a retirement plan at work. Double check to make sure you are at least contributing enough to receive a matching contribution by your employer.
-If you are, them let’s look at the option of maximizing your contribution. In 2016 you are allowed to contribute $18,000 to your retirement plan, such as 401k, 403b or 457b. This is a great opportunity for two distinct reasons:
a. Helps reduce taxable income – every dollar you are putting away is going to reduce your taxable income. So, you will pay less in taxes in 2016.
b. Helps save for retirement – we all know we need to do this! So do it! The sooner you start the more time you have and the more savings you will able to accumulate!