It is hard to believe the end of the year is already here. There are so many things you can do with your finances to close out the year strong and prepare the right way for 2021. When it comes to the holidays, giving to places and causes people feel strongly about is a popular activity, and it can be super beneficial for your finances in terms of saving on taxes. Want to learn how charitable giving can positively impact your finances? Keep reading!
- Donate Stocks
If you have stocks that you’ve had for a while, it could be beneficial for you to gift them, as a potential tax deduction could result from it, as well as the avoidance of capital gains tax. A best practice for giving away stocks you have had for a while is to not give stocks away that are worth less than what you originally paid for them. Prior to donating this kind of stock, a popular option is to sell it and use the proceeds towards a cause of your choice.
- Consider Any Financial Issues to Determine Your Giving Strategy
Depending on the types of assets you have, retirement accounts, and your taxes, some issues could arise when trying to establish your giving strategy. While it is best to determine these issues prior to the end of the year, it is crucial to take note of any issues you do have in order to get your strategy straight in general. To help guide you in determining any financial issues that could impact your giving strategy, visit our website here to see a helpful checklist that will outline some steps to take regarding how you are going to give back this year.
- Explore Donor-Advised Funds
Donor-advised funds are a great source for tax deductions. As long as you do your research regarding an organization and make sure they are a 501(c)(3) organization that reciprocates your goals and beliefs, you should be able to receive a tax reduction. With a donor-advised fund, you are able to offset a successful year and feel good about it. To learn more about donor-advised funds, we would love to help explain the process more in-depth.
As the end of the year is quickly approaching, it is important to make sure your finances are squared away for 2021. After seeing how 2020 went, it is in your best interest to plan ahead for your financial future. We never know what will come, and being prepared is one of the best practices you can take. If you have not yet decided on a strategy for 2021 and your finances, Three Bridges Planning is here to help you nail down a plan. If you would like to learn how we can help, visit our website at https://www.threebridgesplanning.com/