FINANCE
Crucial year-end financial tips How you can enhance your fiscal health in 2021 By Karen Telleen-Lawton
M
any of us are happy to see 2020 come to end. One way you can improve the new year is by making financial plans for 2021. For many of us, the pandemic has reduced our active lives to a fraction of their former selves. That can wreak havoc on our psyches. Think about how you would like next year to be different and make a plan to enhance your fiscal prospects next year. Required Minimum Distribution (RMD). Your retirement savings are available for withdrawal without penalty any time after age 59½, but will be treated as income and taxed as such. There are even circumstances where you can start withdrawals earlier. If you’re stretched thin or have a foreshort-
ened life expectancy, by all means, start drawing on the money you’ve saved. Otherwise, your best bet financially is to wait until you must start removing the funds, which is age 72. At that magic age, a formula determines how much you must withdraw each year (RMD). The CARES act waived RMDs for 2020, but check your situation carefully. The penalty for under-withdrawing is 50 percent! Health Savings Account (HSA). Working seniors may still have an HSA, as long as they are not already signed up for Medicare. Max out your contribution. If your employer contributes to your HSA but that contribution zeros out at the end of the year, consider whether non-emergency medical proce-
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dures can be scheduled sooner rather than later. Flexible Spending Account (FSA). FSAs are another option for establishing a reserve for medical expenses. Any pretax dollars remaining in your account at year-end will be taxed, so determine if you have an upcoming medical expense that can be pulled forward, such as prescriptions, eyewear and so forth. Understand your FSA’s rules, especially concerning details on rolling over funds into the next year. W-4. Year end is a good time for workers to review their W-4, the document that instructs employers how much of your paycheck to withhold for income taxes. The Government Accountability Office says about 21 percent of taxpayers don’t withhold enough, resulting in
finances bigger tax bills in April. You can use the IRS withholding calculator to help estimate the right number of allowances to claim. Another alternative is to choose “0” allowances, which will result in you paying a larger chunk of taxes early on. Late each year you can file a new W-4 if the calculator suggests you’ve withheld too much. Siphon
While your retirement vacations are on hold, let’s make sure your health needs are taken care of.
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“I love restoring smiles and oral health. I believe healthy teeth and gums are critical for the overall health of the individual. I want all of our patients to be healthy and enjoy a full life. I count it a privilege to help my patients be restored to dental health.” Sincerely, Donald E. Couchman, D.D.S. Insurance Welcome – Call for details Financing (WAC)
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1) Are you turning 65 this year? 2) Have you recently moved into the area? 3) Are you currently enrolled on a Medicare plan? 4) Are you over 65 and on a company health plan? 5) Do you have any questions about how Medicare works? 6) Are you on Tricare, a federal plan or have VA benefits and want to reduce Part B premiums? 7) Does your current plan include dental, gym, vision and hearing benefits? Give us a call for a FREE REVIEW to make sure you are on the best Medicare plan that fits your needs.
(719) 593-0263 – 5145 Centennial Blvd., Ste. 100 www.couchmandental.com Member American Dental Association, Colorado Dental Association, Colorado Springs Dental Society, Member International Congress of Oral Implantology, American Academy of Implant Dentistry, American Academy of Cosmetic Dentistry
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