November 21, 2025

As the year draws to a close, it’s the perfect time to review your financial picture and take steps that can lower your tax bill, boost retirement savings, and set you up for long-term success. Strategic year-end planning isn’t just for the ultra-wealthy—it’s for anyone who wants to make their money work for them. From tax-saving strategies to retirement moves, here are six smart financial moves you may want to make before December 31st.

1. Consider a Roth Conversion

If you’ve built up savings in a traditional IRA or 401(k), that’s great–but those large balances represent a growing tax liability. That’s because money in your pre-tax savings accounts is tax deferred, meaning it hasn’t been taxed yet. When you pull out those funds in retirement, you’ll pay income tax on any withdrawals. 

A Roth conversion can be a powerful long-term move. This strategy involves transferring money from a pre-tax retirement account into a Roth IRA.

Why It Matters

• Traditional accounts are taxed when you withdraw the money.
• Roth IRAs, on the other hand, grow tax-free, and qualified withdrawals are also tax-free.
• By converting now, you pay taxes at today’s rates instead of potentially higher rates in the future.

When It Makes Sense

• If you’re in a lower income year
• If you believe tax rates will rise in the future
• If you want to leave tax-free assets to heirs
• If you face potentially large RMDs in the future

Key Tip

At Wurz Financial Services, we help clients with Roth conversions regularly. We can help you decide if this strategy is right for you. 

2. Maximize Charitable Giving with Donor-Advised Funds

The holiday season inspires generosity, and making charitable donations before year-end can also bring tax benefits. But there are some rules you’ll want to pay attention to if you want these donations to be tax deductible. 

For donations of cash, you must itemize in order to take these deductions. The standard deduction for 2025 is $15,750 for single filers or married couples filing separately, and $31,500 for married couples filing jointly. So, in order to get a net tax benefit, you’ll need to make sure your donations, along with your other itemized deductions are greater than the standard deduction. 

In general, the maximum you can deduct is up to 60% of your AGI (adjusted gross income). 

If you are taking RMDs (requirement minimum distributions), you could direct your entire RMD to charity via a QCD (qualified charitable deduction). This is more effective than giving cash to charity, because the RMD is excluded from income entirely. You also don’t have to worry about the standard deduction or 60% AGI limits. 

Key Tip

Consider “bunching” multiple years of charitable contributions into one year to exceed the standard deduction threshold and maximize tax savings by using a DAF (Donor Advised Fund). We can help you set one up. 

3. Use Tax-Loss Harvesting to Offset Gains

No one likes investment losses, but tax-loss harvesting turns those losses into an opportunity. Investment losses can be used to offset gains and reduce taxes on gains. A portion of losses can even be deducted against regular income. 

How It Works

• Sell investments that have declined in value.
• Use the losses to offset capital gains from investments you sold at a profit.
• If your losses exceed your gains, you can offset up to $3,000 of ordinary income, and carry the rest forward into future years.

Watch the Wash-Sale Rule

You can’t buy back the same (or substantially identical) investment within 30 days of the sale, or the IRS will disallow the deduction.

Key Tip

We help clients take advantage of losses throughout the year. We can help you analyze your portfolio to find losses to harvest. 

4. Max Out Retirement Account Contributions

One of the best year-end moves is to make sure you’re saving as much as possible in tax-advantaged retirement accounts.

401(k) Contributions

• For 2025, the maximum employee contribution is $23,000 (or $30,500 if you’re age 50+).
• If you’re over 50, you get an extra catch up contribution of $7,000
• And (new this year), if you’re between the ages of 60 and 63, you get an additional $11,250 on top of the standard catch up contribution
• Pre-tax contributions reduce your taxable income for the year.
• If you’re in a lower income year, consider making a Roth contribution

IRA Contributions

• You can contribute up to $7,000 (or $8,000 if you’re 50+).
• Traditional IRA contributions may be tax-deductible depending on your income and access to a workplace retirement plan.

Key Tip

If you don’t qualify for getting a deduction for your traditional IRA contribution or making a Roth IRA contribution, a backdoor Roth contribution may be the right option for you. We can help you set that up. 

5. Review Your Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs)

Healthcare-related accounts are another area that deserves year-end attention.

FSAs (Use It or Lose It)

• FSAs are employer-sponsored accounts where you set aside pre-tax money for medical expenses.
• Most plans require you to use the funds by year-end, or you’ll lose them (though some allow a small carryover or grace period).

HSAs (Triple Tax Advantage)

• If you have a high-deductible health plan, you may contribute to a Health Savings Account.
• HSAs are the only account with triple tax benefits: tax-deductible contributions, tax-deferred growth, and tax-free withdrawals for qualified medical expenses.
• For 2025, contribution limits are $4,300 for individuals and $8,650 for families, plus an extra $1,000 catch-up for those 55+.

Key Tip

Check your balances now—schedule that dental cleaning, eye exam, or stock up on eligible medical items before your FSA deadline. For HSAs, consider investing unused funds for long-term healthcare expenses in retirement.

6. Rebalance Your Investment Portfolio and Check Asset Allocation

The end of the year is the perfect time to review your investment strategy. Markets fluctuate, and over time your portfolio may drift away from your target asset allocation.The large run-up in tech stocks in 2025 may mean your portfolio is off-balance. 

Why It Matters

• A portfolio that’s grown too heavy in one particular asset class may expose you to more risk than you’re comfortable with.
• A portfolio that’s too conservative could hold back growth.

What to Do

• Compare your current portfolio mix to your target allocation.
• Sell overweighted positions and reinvest to restore balance.
• Consider your risk tolerance, age, and financial goals when rebalancing.

Key Tip

You should also check your “asset location,” that is which accounts hold different funds or stocks. Funds or stocks that pay dividends, for example, should be held in tax-deferred accounts whenever possible to maximize tax efficiency. 

Bonus: Other Year-End Financial Tasks Worth Considering

While the six moves above are the big ones, here are a few bonus strategies to add to your checklist:

• Make your required minimum distributions (RMDs): If you’re age 73 or older, you must take RMDs from retirement accounts to avoid steep penalties.
• Review your estate plan and beneficiaries: Make sure wills, trusts, and account designations are up to date.
• Check your credit report: Use the free annual credit report to ensure accuracy before the new year.
• Plan for next year’s goals: Budget for upcoming expenses, travel, or major purchases.

By considering Roth conversions, maximizing charitable giving, harvesting investment losses, maxing out retirement contributions, optimizing healthcare accounts, and rebalancing your portfolio, you can position yourself for greater success in the new year.

Don’t wait until December 31st—many of these strategies require time to implement.

At Wurz Financial Services, these are just a few of the year-end things we help clients with every year. If you’re looking for a strong wealth management team to guide you through these decisions every year, schedule a call with us today.