The calendar has reached the final month of the year, giving you just days to make some year-end financial moves. These strategies can help lower your risk of identity theft and give you a better picture of your financial health.
None of them should take long — you can probably knock them out during the commercial breaks of your favorite TV shows.
1. Change passwords
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Make a point to update all passwords for next year, especially those for bank, credit card and other sensitive accounts.
You could use a notebook and pen to record your new passwords, but a much better idea is using one of the numerous free password manager programs available. Most will generate and store strong passwords for you. Then you only have to remember one.
2. Request a free credit report
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Federal law entitles you to one free credit report every year from each of the three major credit reporting agencies. Download one during a commercial break, and review it for mistakes or suspicious activity.
Make sure you are requesting your reports from AnnualCreditReport.com, the official website for free credit reports. Other websites might send you reports, but there’s usually a catch. For example, the site might automatically enroll you in a credit monitoring service or some other subscription program. While you’re at it, check out our Solutions Center for help with credit card debt.
3. Review your FSA balance
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A rule enacted in 2013 permits employers to let flexible spending account participants roll over up to $500 into the next year.
Note, however, that employers aren’t required to offer a grace period or a rollover. So, now’s the time to find out your employer’s policy. If the employer does not participate in either option, use a commercial break to go shopping. Spend that money on qualified expenses by doing things like refilling prescriptions or maybe buying new glasses.
4. Complete an investment review
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Sound time-consuming? Not really. You can do an investment review in 15 minutes or less with these steps. In a nutshell, you want to check your investment performance, review your fees and reallocate balances if needed.
While examining and understanding your investments might seem boring, it’s exciting compared with the commercials you’ll be missing.
5. Sell losses to offset gains
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Look for loser investments and consider unloading them. Selling a stock or other security at a loss can offset investment gains you’ve taken during the year, thus lowering your tax bill.
If you don’t have gains, losses can also be used against up to $3,000 of your regular income. Net losses exceeding $3,000 will be carried over to future years.
There are a couple of caveats. For starters, losses in tax-advantaged retirement accounts — like an IRA or 401(k) — aren’t deductible.
You also cannot game the system by selling a stock at a loss, then buying it back a few minutes or days later. For an investment loss to be deductible, you can’t purchase a substantially identical security within 30 days before or after a sale.