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An Annual Financial Calendar: Key Action Steps

January 2014

Barbara O’Neill, Ph.D., CFP®
Extension Specialist in Financial Resource Management
Rutgers Cooperative Extension

Many dates are predictable in the world of personal finance. For example “tax season” always occurs during the first quarter of each year and December 31 is the last day of each calendar year to make charitable donations for itemized deductions. Sometimes we are so busy that it is easy to forget financial milestone dates or the best times to take certain actions. Below is a list of recommended action steps for each month of the year:

January: Start the year off right by reviewing your financial situation with an updated net worth statement. Determine the value of what you own (assets) and what do you owe (debts) as well as how much income you earn and where it goes. Also pay the IRS your final estimated tax payment for the previous year, if applicable.

February: Organize tax documents to prepare your federal and state income tax returns. Make an appointment with a tax preparer or buy tax preparation software, if needed. If you haven’t already done so, fund your last year’s IRA this month or next so you’re not rushing to do this right before the April tax filing deadline.

March: Reduce clutter in your financial life by “spring cleaning” your finances. Keep only important receipts, records, and papers. Instead of using the "stash and pile" method of organization, take a "file It, find It" approach. Develop a summer vacation budget now so you have several months to save what you need.

April: File your tax return by the tax filing deadline or file for an extension to avoid penalties. Complete paperwork and deposits for IRA and SEP savings plans. If applicable, make a first quarter estimated tax payment.

May: Continue saving for your summer vacation and develop detailed plans. Make travel arrangements and reservations, if not done previously. Pay down outstanding debt, bulk up your emergency fund, and/or save for a financial goal with your tax refund. Check the semi-annual rate on U.S. savings bonds (announced on May 1).

June: As farmer’s markets open, look for deals on fresh produce. Conduct a mid-year review of income tax withholding and adjust your W-4 form or remaining estimated tax payments if needed. Service your car to save on gas when prices are higher in the summer. If applicable, make a second quarter estimated tax payment.

July: Continue your mid-year financial review. Adjust your spending plan (budget) or rebalance the weighting of investments, if needed, to return to your desired asset allocation. Celebrate Independence Day by doing something to secure your financial independence (e.g., start or increase retirement plan savings).

August: Can or freeze fruits and vegetables from your garden or farmer’s markets to eat later when produce is more expensive. File your income tax return by August 15 if you got an extension beyond the April deadline. Look for sales and sales tax “holidays” for back-to-school shopping for clothes, shoes, and school supplies.

September: Consider laying away items for the holidays now so you have several months to earn the money to pay for them. If you need a new car, take advantage of sales as auto dealers clear out current year models. Start a holiday savings club plan for next year. If applicable, make a third quarter estimated tax payment.

October: Prepare your home for winter with an energy audit from your utility company. Take advantage of open enrollment season for your employer’s health insurance plan, a state health insurance exchange, or a Medicare Part D prescription drug plan. Get a flu shot and start considering year-end financial moves such as “bunching up” itemized tax deductions.

November: Consider your income tax withholding for next year and file a new W-4 form with your employer, if needed. Take advantage of holiday sales at stores and/or online. Review and/or revise employer retirement savings plan contribution for next year and check the semi-annual rate on U.S. savings bonds (announced on November 1).

December: Distribute good will to family and friends and share your bounty with others. Give wisely to charities. Look for year-end bargains during before- and after-holiday sales. Set one or more financial goals for next year. Consider giving tax-free gifts to relatives that count for this year’s gift tax exclusion. Use all or part of a year-end bonus for savings and/or debt repayment. Make an early fourth quarter estimated tax payment or mortgage payment, if you need tax deductions, and a required minimum distribution (RMD) from tax-deferred retirement accounts if you are over age 70 ½.