In our latest episode of “Real Personal Finance,” we’re talking all things tax projections. While taxes may not be your favorite topic, the money you can save with a little planning makes it well worth your time.
First, we talk about a couple tax moves you can make if you are expecting a low-income year due to a sabbatical or unemployment. If this is your situation, you may want to consider a Roth IRA conversion. You may also want to consider tax gain harvesting so you can sell stocks and lock in gains while lowering the taxes you pay.
We also share a few strategies to consider if you anticipate a higher income year. First, make sure you’re maxing out your contributions to 401(k), 403(b), HSA, and any other accounts you may have. It’s surprisingly common for people to fail to max out their employer’s 401(k) match even though they think they’re going to make it.
After that, we talk about how you can “stack” your charitable contributions to help lower your taxable income through a donor-advised fund. We also talk about navigating exercisable incentive stock options (ISOs). If you’re in a privately held company, you want to exercise these options every year.
But before you do any of that, we highly recommend finding a CPA who can help you navigate decisions like these. A good CPA is getting harder and harder to find, but they’re still out there!
We cover a lot more in this episode, so be sure to tune in and plan to sit down to get your tax projections done before the end of the year.
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Money can be confusing—but it doesn’t have to be. When you’re able to understand the complexities, you can make better decisions to improve your daily life. Are you ready to align your money with your ideal life? Connect with us at Stone Steps Financial or Flow Financial Planning.
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