2025 Year-End Financial Checklist: 7 Smart Moves to Make Right Now
As 2025 winds down, it’s a perfect time to take stock of your financial picture before the calendar turns. A few thoughtful steps now can reduce taxes, reinforce your long-term plan, and set you up for a strong start to 2026. At Cascade Wealth Planning, we often think of this season as the “annual financial checkup” a chance to clear the clutter, tighten strategy, and make sure your money is working the way you intend.
Here are seven high impact moves to consider before December 31.
1. Maximize Tax-Advantaged Retirement Contributions
If you’re still working, review what you’ve contributed to your 2025 retirement accounts:
401(k), 403(b), 457(b) limits: $23,500 for 2025, plus an additional $7,500 catch-up if you’re 50 or older. The catch-up is $11,250 if you are between 60-63.
Traditional and Roth IRA contributions: Up to $7,000, or $8,000 if 50+ (you technically have until April 2026, but making contributions now may improve compounding and simplify tax prep).
If your income is higher in 2025 or your cash flow allowed for more savings than you planned, boosting contributions before year-end can reduce your taxable income and increase long-term retirement readiness.
2. Review Your Tax Strategy and Harvest Gains or Losses Thoughtfully
Tax planning is a year-round sport, but the final month of the year is when most people focus their attention on this area of personal finance.
Tax-loss harvesting:
If any taxable investments are sitting at a loss, you may be able to sell them to offset gains taken earlier in the year or reduce up to $3,000 of ordinary income. Just be careful of wash sale rules and buying into any dividends or capital gain distributions. You will also want to be comfortable with the substitute security you choose as you may end up holding it for longer than 31 days if it goes up more than you expected
Tax-gain harvesting:
For those in lower tax brackets, especially retirees or temporarily low-income years, realizing gains intentionally may allow you to pay 0% capital gains tax.
Before acting, coordinate with your advisor and CPA to ensure the tax benefit doesn’t accidentally weaken your long-term plan by pushing you in higher taxes or losing subsidies.
3. Complete Your Required Minimum Distributions (RMDs)
If you’re 73 or older, or if you inherited an IRA or other tax-deferred account, you may need to take an RMD by December 31. Missing the deadline can trigger IRS penalties.
One smart move many retirees are using:
Qualified Charitable Distributions (QCDs) allow you to send up to $108,000 (2025 limit) from your IRA directly to a qualified charity. It satisfies your RMD but keeps the amount out of your taxable income—often a more tax-efficient strategy than giving cash.
4. Check Your Withholding and Estimated Tax Payments
If you experienced income changes this year, consulting income, a large bonus, investment gains, the sale of a property, or a transition to retirement, you may have over or under withheld taxes.
Year-end is the time to fix this:
Avoid penalties for underpayment
Prevent a painful surprise in April
A quick review now can save frustration (and cash) later.
5. Revisit Your Financial Plan and Investment Allocation
A lot can change in a year. As 2025 closes, ask yourself:
Did your income, family dynamics, or goals change?
Are you on track for retirement or other major goals or milestones?
Does your investment allocation still match your risk tolerance and time horizon?
If markets moved significantly, does your plan still work?
6. Make Smart Use of Annual Gifting and Education Savings
A couple of time sensitive opportunities that are often overlooked:
Annual gifting exclusion:
You can give up to $19,000 per person in 2025 without touching your lifetime gift tax exemption. Great for parents or grandparents looking to transfer wealth efficiently.
529 plan contributions:
States often provide deductions or credits for contributions made before year-end. Even small deposits can meaningfully compound over time, and front-loading contributions often gives college savings a head start.
If you’re supporting children or grandchildren, or thinking about long-term multigenerational planning, this is an easy win.
7. Update Beneficiaries, Insurance, and Estate Documents
Life moves fast, but paperwork rarely updates itself. Use year-end to review:
Beneficiary designations on retirement accounts and life insurance
Health insurance, life insurance, and disability coverage
Wills, trusts, and powers of attorney
Digital asset instructions and account access
These are simple checks with huge long-term impact. Making sure documents reflect your current wishes prevents complications later and protects the people you care about most.
Start 2026 With Clarity and Confidence
A year-end financial review doesn’t need to be overwhelming. In fact, many of these steps can be completed in under an hour with the right guidance.
At Cascade Wealth Planning, we help families and professionals bring clarity and strategy to their financial lives, especially during turning points like year-end. If you’d like support reviewing your 2025 plan or preparing for a strong 2026, we’re here to help.
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