Retirement Strategies at Year's End

Why It Matters:

  • The holiday season can be a good time to reflect on the year gone by – personally, professionally, and, of course, financially.
  • A big picture, year-end review of your retirement strategy can help align goals and steps to take going forward.
  • Doing a little “housekeeping” now can help you start the new year on the right foot and get an early start on tax preparation.

Ryan Johnson tkc.profilePicture Written by: Ryan Johnson | Transamerica
Dec. 12, 2017

5 Min readClock Icon

For many people, the holiday season can be a good time to reflect on the year gone by. What did you accomplish, what did you learn, and what (if anything) would you do differently?

It’s also a good opportunity to take stock of your retirement strategy, make any necessary adjustments, and think about the year(s) ahead.

While the holidays are often busy, finding time to get your accounts organized may help you start the new year feeling a little less stressed. Of course, the very task of getting organized can be stress inducing. To make the chore a bit more manageable, Transamerica’s Advanced Markets Group created a useful checklist to help you think about your retirement picture at year’s end.

Some highlights are outlined below, but it’s worth reviewing the list in its entirety here. Additionally, if you’re a small-business owner, you’ll find some useful information setting up retirement plans to meet your needs below.

Start with a personal financial inventory

If you’re already good at keeping tabs on your records, you can probably jump ahead. But if you find yourself wondering where to begin, Investopedia suggests creating a personal financial inventory to “give you a snapshot of how healthy your bottom line is.” A few items from the suggested inventory include:

  • A list of assets like your emergency fund, retirement accounts, other investment and savings accounts, real estate equity, education savings, as well as valuable personal property.
  • A list of debts, including your mortgage, student loans, credit cards and other loans.
  • Your credit report and score.


With your financial inventory up to date, you can begin to answer questions and look more closely at specific actions you might need to take to keep your strategies on track.

What’s new with you?

They say in life the only constant is change. Understandably, changes in your personal life and within your family may impact your priorities. The checklist from Transamerica’s Advanced Markets Group reminds you to start with updating any pertinent life changes.

What happened in the last year? If you got married, divorced, had a baby, started a new job, lost a family member to death, or encountered any number of personal events, it’s worth checking in with your financial professional. And if any of these changes impact tax withholdings, consider booking a few minutes with your employer’s HR person to make appropriate updates to your tax forms.

A simple beneficiary designation review can help keep your qualified plans, IRAs, life insurance policies, and other retirement accounts current. This is also a good time to update your estate planning documents. By the way, if you’ve put off creating an estate plan, you might want to add that to your to-do list in the new year.

Make the most of your contributions

If you haven’t already established a retirement savings account, many financial professionals would suggest making that a priority. The Motley Fool offers this comparison of a traditional 401(k) account and traditional IRA with some pros and cons of each. Both allow you to shelter contributions and earnings from taxes until you start taking withdrawals, when they would be taxed as ordinary income.

Let’s assume you’re already putting money into a retirement savings account. Because different accounts are governed by different rules, you should also familiarize yourself with the contribution limits to make sure you’re maximizing how much you can set aside.

In 2017 for example, you can contribute up to $18,000 to a traditional 401(k) if you’re under the age of 50. If you’re 50 and over, you’re allowed an additional $6,000 catch-up contribution, for a total of $24,000 for the year. In 2018, the limit goes up to $18,500 and the catch-up contribution remains the same.

By contrast, a traditional IRA allows a contribution of $5,500 if you’re under 50 in 2017. If you’re 50 and over, you can add an additional $1,000 this year. The limit remains the same in 2018.

Eligibility for contributions and tax deductions varies. According to Transamerica’s Advanced Markets Group: “The ability to deduct a Traditional IRA contribution is dependent on your level of income and whether you or your spouse are covered by an employer-sponsored retirement plan at work. Your ability to make a Roth IRA contribution is also dependent on your level of income. Traditional IRA and Roth IRA contributions can be made up until the individual tax filing deadline without extensions (April 15).”

If you’re unclear on eligibility and contribution rules, speak with a financial professional.

Retirement options for small-business owners

As a small-business owner, you have the opportunity to establish retirement accounts into which your employees can contribute. Transamerica’s Advanced Markets Group offers this helpful guide to determine an option that might best fit your needs based on your goals and situation. Factors like number of employees, administration costs, eligibility of employee and/or employer contributions, and contribution schedules can help dictate the appropriate course for your business. In addition to 401(k) plans, additional options include:

SEP IRA

A SEP (Simplified Employee Pension) IRA is an employer-sponsored retirement plan that is funded by employer contributions only. The employer can contribute up to the lesser of 25% of an employee’s compensation or $54,000 (2017).

SIMPLE IRA

A SIMPLE (Savings Incentive Match Plan for Employees) IRA is an employer-sponsored retirement plan that can be funded with both employer and employee pretax contributions. SIMPLE IRAs give employees the ability to contribute a portion of their salary into their own retirement account in addition to the employer’s contribution. There is a 100-employee maximum with this option.

Establishing and offering retirement savings accounts for your employees can be a challenge, but it of course comes with potential benefits for you and your business. Possible upsides are:

  • Helping you attract and retain employees.
  • Providing tax advantages for you and your business.
  • Enabling your employees to save a portion of their wages before taxes.
  • Giving your employees a tax-deferred retirement savings vehicle.
  • Helping you and your employees invest for retirement


If you haven’t already established some form of retirement savings accounts for your business and employees, it might be worth having a discussion with a financial professional as the new year begins. The process might be less complicated than you imagine.

Things to Consider

  • Start your year-end review with a personal financial inventory. Look at assets and debts.
  • Review any life changes from the past year with your financial professional.
  • Be sure to review your 401(k) and/or IRA accounts. Know the limits for each account type so you can maximize contributions.
  • If you’re a small business owner, talk to a financial professional about retirement account options for you and your employees.

Neither Transamerica nor its agents or representatives may provide tax, investment or legal advice. Anyone to whom this material is promoted, marketed, or recommended should consult with and rely on their own independent tax and legal advisors and financial professional regarding their particular situation and the concepts presented herein.

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