December Financial Checklist

It’s the most wonderful time of the year!

I absolutely *love* the holiday season.  I love searching for the perfect gifts, baking yummy treats, decorating the house, watching Christmas movies (Elf!) and just being together with my family.  My husband has the last 2 weeks of the year off, and all my kids are living at home now, so we’ll have lots of opportunities to hang out!

This year, my mom and brother are coming out from Las Vegas, and we’re super excited.  My brother is like a big goofball and has no wife or kids of his own, and the kids love hanging out with their Uncle Mark.

As we wind down the year, our schedules start to get busier and priorities can get rearranged.  So, I just want to encourage you to be intentional about your finances – however small the task – so you can start the new year on the right foot.

You can use this list or make your own to be purposeful about staying on track.  The most important thing is to make sure your actions are in line with your values.

Here is my list of 5 things you can do in December to stay focused on your finances.


1.  Use Up Your FSA

If you have a Flexible Spending Account that expires at the end of the calendar year, be sure to use up whatever balance there is.  Otherwise, you will lose that money.

The qualifying expenses are limited, so plan how you will use up the remainder of the funds.  FSA funds can be used for co-pays, prescriptions, deductibles and medical equipment.  It cannot be used for insurance premiums or over the counter products without a prescription.

On the November Financial Checklist, one task was to plan end-of-the-year doctor and dentist appointments.  Use your FSA funds to cover any out-of-pocket costs resulting from these visits.

If you find that you have an excessive amount in your FSA, consider lowering your contributions for 2020.  The last thing you want is to lose money just because you didn’t use it.


2.  Consider Refinancing High-Interest Debt

One of the easiest ways to lower your debt is to refinance for a lower interest rate.  December is a good time to make this move as you prepare for new goals in 2020.

Related Post:  August Financial Checklist

This past year I refinanced our credit card debt and our mortgage.  Because of this, we are literally savings thousands of dollars in interest.

If you have a significant credit card balance, look for a promotional 0% rate to transfer to.  You will likely have to pay a 3% transfer rate on the balance, so you’ll need to weigh this cost against the time you’ll need to pay it off.

We have about $8K in credit card debt, and the 3% fee ends up being significantly less than the interest I would pay over the time we need to pay it all off.

I also converted and refinanced our mortgage from an adjustable rate to a fixed rate loan, saving us close to $400 a month.

With a little research to find the best rates, you can use your good credit to drastically reduce the amount of interest you’re paying on your debt.  Take the time this month to cut those rates so you can set yourself up to reach your financial goals faster in 2020.


3.  Get Your Taxes Organized

I know there’s usually a lot going on in December, and organizing tax documents is probably not at the top of your to-do list.

But if you take the time to do it now, you can possibly make some adjustments before the end of the year to ensure the best possible outcome in April.

I always create a file folder in January to hold anything tax-related that I receive throughout the year.  So, most of my organizing is done on an ongoing basis.  But, inevitably I find stray Goodwill receipts in a random drawer that need to be filed away.

You can make sure you have the required documents to support any deductions and credits you plan to take, and check in with your tax person to see if there’s any other paperwork you’ll need.

Of course, you won’t receive W-2 forms and interest statements until January, but if you get everything else organized now then it’ll be a snap to put it all together and get those taxes done early.


4.  Cut Your 2019 Tax Bill

If you’re close to meeting the standardized deduction by itemizing, you can possibly tip the scale by making some additional expenditures before the end of the year.

Related Post:  15 Financial Goals to Start With

One way is to pay January’s mortgage payment in December.  This will give you 13 months of mortgage interest deductions for 2019.

You can also pay next year’s property taxes early to get a little extra tax deduction.  This tax payment can be claimed in the year it was paid.

If you make a contribution to a non-profit organization on a regular basis, consider giving a portion of next year’s donations this year.  If you don’t want to increase your annual giving, you can give less next year and take the standard deduction the following tax season.

Also, if you’re close to meeting the minimum deduction for medical expenses, you can get elective medical procedures done so you can apply those expenses to your 2019 taxes.

For those with college students, pay the first quarter tuition bill for an extra tax break.  You don’t even need to itemize to get this bonus, thanks to the American Opportunity Tax Credit.  You can also prepay for undergrad classes related to your profession and claim the Lifetime Learning Credit.

One more idea is to max out your pre-tax retirement account contributions.  This will lower your take-home pay and reduce your tax bill.  But most importantly, you’ll be giving more savings fuel to the compound interest flame!


5.  Write Down Your 2020 Financial Goals

Most people wait until January to make any resolutions or goals for the new year.  But, if you want to hit the ground running on January 1st, put your goals in place in December.  That way you start with focus and have a clear direction on the first day of 2020.

For me, thinking about goals always give me a renewed sense of inspiration and hope.  Just writing them down makes me feel excited about what’s possible, and how they’ll get me that much closer to my dream retirement vision.

But I can also feel a little overwhelmed when I think about everything that I want to accomplish.  Where do I start?  What takes priority?  How will I get it all done?

Related Post:  March Financial Checklist

If you can relate, here are a few guidelines you can use when developing your own 2020 financial goals list:

  • Know what you value.  If you are clear on what you value, you can more easily determine goals that will be meaningful to you.  You’ll be able to prioritize effectively and be certain your efforts will result in a more fulfilling life.
  • Break down your goals in time chunks.  Some goals may take a week to achieve, others could take a month, and still some may require the whole year.  As you write down your goals, assign a deadline so you can have a sense of when each goal should be reached.
  • Use the SMART structure.    SMART is an acronym that stands for Smart, Measurable, Achievable, Relevant, and Time-bound.  If you apply each of these characteristics to every one of your goals, you will increase your chances of achieving them.  For a more detailed guide to SMART goals, read this helpful article.

Having some goals is a great way to be more purposeful in your life.

But having the right goals that are value-driven can change your life.


Plan Your Checklist

It’s easy to let all the end-of-the-year, holiday activities keep you from staying on track with your finances.  After all, decorating the tree and wrapping gifts is so much more fun, right?

Believe me, I would much rather be reading a book, by the fire, sipping on eggnog, than thinking about taxes.

But I know that if I spend a little time and intention to make sure my finances are in order, it frees my mind up to be fully present with my loved ones.  It also keeps my mindset sharp and aware, and I’m less likely to make financial choices I’ll regret come January.

As you plan for all the festivities this season brings, I encourage you to also make time in your schedule for wise money practices.  Be intentional about planning your checklist by making appointments with yourself to get each task done.

I hope your December is overflowing with all the warmth and love that comes with spending time with people you care about – Merry Christmas and Happy Holidays!!

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