Getting Organized at Tax Time

Preparing our taxes is a task we’ll all have to face at some point this spring. As you sit down to gather your financial paperwork, why not take time to strategize your finances, too?

Here are things to think about as you gather your tax paperwork:

  • Should you take action on any financial accounts?Consider whether you should make adjustments to your 401(k), rebalance or consolidate your retirement accounts, or set up an automatic transfer to savings.
  • How are your passwords documented? Where and what are the usernames and passwords of your financial accounts? Are they securely stored? Once you have them together, give them to someone you trust.
  • Should you go paperless? Digitizing your financial paperwork can make finding important documents easier; however, going completely digital can be daunting. This year, get in the habit by starting with your tax docs. As you accumulate next year’s tax paperwork, file it electronically.
  • Do your health benefits meet your needs? Because you’ll be looking though last year’s medical bills for deductions, consider whether your insurance plans meet your medical expenses. For example, did you meet your deductible? If not, consider switching to a different plan.
  • Do you have the right amount of insurance? Make sure your home, auto, and other insurances are reflective of your current assets and lifestyle.
  • Where is your will? Does your executor have a copy, and when did you last update it? A best practice is to update every five years.

Since you are already gathering information on many of the topics above, tax time is a great opportunity to go just a little further and bring additional order to your financial records.

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