Every year, the holiday season sneaks up on us and, before we get to turn around, it’s over. This frenzied time of year is filled with shopping excursions and office parties, and it’s easy to let financial planning slip through the cracks at the very moment when it may have the greatest impact. Here are some tips for timely year-end planning that may make a big difference.

Saving on Taxes

One of the main reasons that most people take the time to plan ahead toward the end of the year is to save money on taxes. Once this time of the year comes around and you take the time to look over your finances, you may use this information to make good decisions that could help manage your tax liability.

The nice thing about this is that you have options on when you can act to impact this year's taxes. For example, if you want to contribute to charity, you have the option of doing it before the end of the year rather than waiting until next year. Likewise, if you want to lower your taxable income, you could make contributions to a retirement account just before the end of the year. You may want to take money out of your retirement funds or pay off some medical bills.

Setting Financial Goals for the New Year

While year-end planning requires you to glance in your rearview mirror, it’s also an excellent opportunity to set your sites on the open road before you – and plan what financial milestones you’d like to have as goals next year. Are you ready to save more money? Pay off debt? Make your first investment? Set those goals now and be ready to focus your efforts come January.

Avoid Last-Minute Stress

When you don’t leave things to the last minute and, instead, schedule them in advance, you may have time to think over a problem instead of being under pressure. You may have more chances for good decision-making if you plan ahead for your finances, check your budget, and review which investments are suitable for your account.

Prepare for Holiday Spending

Paying for the holidays might be expensive. It is better to think about your finances ahead of time because this could give you an idea about how much you might realistically spend on gifts, trips, and other expenses. This process manages your spending so, perhaps, you avoid having a huge credit card bill to start the new year!

Review Your Investments

The end of the year is the proper time to take a look at your investments and their performance. For example, you might need to rebalance your portfolio so you stay on track in pursuit of your goals. You might have to sell off some investments that didn’t perform well, or rotate into some investments to make your portfolio line up better with your goals.

Planning ahead could save you money, manage your stress level, and position you to begin the new year better organized with clear goals. It is a wise strategy to be an “early bird” and put your year-end plan in place now.