2024 End of Year Checklist

Nate Crosby |
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2024: Year-end Financial Checklist

As the year draws to a close, it is once again time for housekeeping in regards to your financial plan. Below are items we recommend reviewing:

  1. Rebalance to control risk: 2024 has been an outstanding year to be an investor. We highly recommend that you review your allocation (mix of investments) to make sure it is still in line with your risk tolerance.  Many asset classes like stocks, precious metals and cryptocurrencies have all made substantial gains this year. If you haven’t rebalanced your portfolio throughout the year, you may find that you are much heavier in some assets than you were in January. Rebalancing your account (bringing the allocation back in line with your original strategy), can make sure your chosen risk level remains constant. Our office rebalances the accounts we manage for you on a quarterly basis. 
  2. Tax loss-harvest: Your investment accounts are higher than they were on January 1st, however, there is a chance not every one of your holdings has unrealized gain. Talk to your advisor to see if it makes sense to sell holdings that are below your purchase price. The current tax code allows an investor to use losses to offset capital gains and if available, up to $3,000 of loss can be used to offset ordinary income. Note, tax-loss harvesting can only be performed with non-qualified (non-IRA) accounts. 
  3. Review beneficiaries: Having a beneficiary listed on your investment account will allow the assets to avoid Probate Court. Probate is the process of retitling assets to heirs. This process can be lengthy and expensive. Having a beneficiary or beneficiaries on your investment account will make sure they receive your assets faster and with more efficiency. 
  4. Review how your accounts will be taxed when withdrawn: We recommend that you have at least one tax-free investment account so that you can better control your tax bracket in retirement. Tax-free investments can be built and funded at any income level. Talk to your advisor to see what type of tax-free account is right for you. 
  5. Review your life insurance coverage: As your life changes, your life insurance coverage should adjust with it. Term insurance policies can be converted to permanent insurance. It’s also important to review your current beneficiaries to make sure they still reflect your intensions. 
  6. Sale of a business: If you own a business and are planning to sell it within the next five years, now would be the time to begin a plan for how you will transfer the business for maximum value. Whether you take payment as a lump sum, installments, or as an annuity payment over many years, your advisor can walk you through the pros and cons of each option. 
  7. Increase revenue: If you are looking to make 2025 your best year, I’d highly recommend a free consultation with our marketing professional, Carly Snyder. I find most clients walk away with more ideas to generate revenue and market share than they can implement in one year. 
  8. Tax return review: Crosby Advisory offers a free tax return review from the previous year to uncover ways to enhance your tax efficiency and retirement savings.

The secret of getting ahead is getting started. — Mark Twain

I wish you great success.

Alternative Investments

Portfolios with risk tolerances of moderate to aggressive often allocate a 3 to 5% position in alternative investments. An alternative investment is a general classification of investments other than traditional investments like stocks, bonds or cash equivalence. Ideally these investments are not directly correlated to traditional investments and serve two purposes within the portfolio: 1) greater diversification, 2) potential for higher return. Since alternative investments offer potential for higher return, they may also exhibit greater volatility. Alternative investments include things like real estate, collector vehicles, rare art, fine wine, precious metals or cryptocurrency. Most Crosby Advisory Group risk-based models include a 5% position in gold. For investors who wish to expand their exposure to alternative investments we also offer Bitcoin exposure through Bitcoin ETFs. 2024 has been a year where exposure to these alternative investments have paid off with gold up 24% and Bitcoin up 102% as of 11/15/2024. If you are interested in adding more alternative investment exposure to your portfolio, please contact our office. An advisor can explain the pros and cons of each type of alternative investment to make sure it meets your objectives and risk tolerance.

 

 

 

Disclaimer: Crosby Advisory Group, LLC (CAG) is a registered investment advisor and licensed insurance firm. We provide financial planning, business growth strategies and insurance services. Any investments mentioned in this newsletter should not be taken as individual investment advice. Investments possess varying levels of risk and you should understand all risks and costs before making an investment. Not all investments are suitable for all investors.