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A Different Degree of Wealth

Key Deadlines for Year-End Financial Planning

As the year comes to a close, there are several important financial planning deadlines that may require attention. Timely action can help you prepare for the year ahead while taking advantage of the opportunities available in 2024. Here are some key areas to focus on and the associated deadlines to keep in mind.

Maximizing Contributions to Retirement Accounts

Contributing to retirement accounts is a valuable step in financial planning. For 401(k) accounts, the maximum contribution limit for 2024 is $23,000, with an additional $7,500 catch-up contribution allowed for those aged 50 and older. To take full advantage, contributions must be made by December 31, 2024. SIMPLE IRA contributions must also be made by December 31, 2024, with limits set at $16,000 and an additional $3,500 catch-up contribution for those aged 50 or older. Contributions for Traditional and Roth IRAs can be made until the tax filing deadline, April 15, 2025. However, planning early may help ensure you stay on track with your savings goals.

Health Savings Accounts (HSAs)

If you have a high-deductible health plan (HDHP), you may be eligible to contribute to a Health Savings Account (HSA). The contribution limits for 2024 are $4,150 for individuals and $8,300 for families, with an additional $1,000 catch-up contribution for those aged 55 and older. Although you have until April 15, 2025, to make contributions for 2024, reviewing your funding progress before year-end may help you optimize your tax benefits.

Tax-Loss Harvesting

Tax-loss harvesting involves selling investments that have decreased in value to offset taxable gains elsewhere in your portfolio. For the strategy to apply to your 2024 taxes, transactions must be completed by December 31, 2024. While tax-loss harvesting may potentially reduce your tax liability, consider consulting a financial professional to better understand how this approach may align with your goals and circumstances.

Required Minimum Distributions (RMDs)

For those aged 73 or older, Required Minimum Distributions (RMDs) from certain retirement accounts must be taken by December 31, 2024. Failing to withdraw the required amount may result in a penalty of up to 25% of the amount not withdrawn. The 25% excise tax rate is reduced to 10% if the error is corrected within two years.

If you turned 73 in 2024, you may have until April 1, 2025, to take your first RMD, but subsequent RMDs must be taken by year-end.

Charitable Contributions

If you plan to make charitable donations and claim deductions on your 2024 taxes, contributions must be made by December 31, 2024. Depending on your financial situation, eligible donations may include cash, appreciated securities, or other assets. To ensure deductibility, donations should be made to qualified organizations.

Flexible Spending Accounts (FSAs)

If you participate in a Flexible Spending Account (FSA), funds typically must be used by the end of the calendar year. Some employers may offer a grace period extending into 2025 or allow a limited rollover amount. Reviewing your FSA balance and planning any necessary medical or dependent care expenses before year-end can help you avoid forfeiting unused funds.

Education Savings Contributions

While contributions to 529 college savings plans do not have a hard deadline, making contributions by December 31, 2024, may help maximize any state tax benefits available to you. Each state has different rules. For example, in South Carolina the deadline for making contributions is April 15th, 2025. Be sure to check the specific details for your plan.

Gifting and Estate Planning

The annual gift tax exclusion for 2024 is $18,000 per individual. Gifting up to this amount per recipient before December 31, 2024, may reduce the taxable value of your estate without impacting your lifetime gift tax exemption. For couples, the exclusion doubles to $36,000 per recipient if split gifting is elected.

One strategy is to give gifts to your children. According to Ballentine’s “Wealth on Purpose”, you may want to consider giving your children stock instead of cash. For additional strategies give Ballentine Capital Advisors a call.

Planning for Estimated Tax Payments

For those who pay estimated taxes, the fourth-quarter payment for 2024 is due on January 15, 2025. Reviewing your tax liability before year-end may help ensure that you have paid sufficient estimated taxes to avoid penalties.

Final Thoughts

Taking proactive steps to meet these year-end deadlines may provide financial clarity as you transition into the new year. With careful planning and attention to these key areas, you can approach 2025 with confidence.

Sources located at the bottom of the article

Golf Tip of the Week:

What you might be getting wrong about picking a target off the tee

What’s your thought process when you stand on the tee? If you’re like a lot of golfers, it’s probably along the lines of: Hit it as far as possible, or hit it as straight as possible. It can be an advantage sometimes to simplify your approach, but when it comes to picking a target, there’s actually some nuance that goes into choosing a target when you have the most powerful club in your hands. Molly Braid, a Golf Digest Best Young Teachers based in Wisconsin, sees a lot of her students not look closely enough at the landing area before picking their target.

Stand on the tee box and picture very specifically where your ball is going to land—and how it will react.

“The landing area on a hole is often sloped in one direction or the other,” Braid explains.

Take the hole she’s playing in the below video. It’s not good enough to aim at the middle of the fairway. As you see in this example, the fairway slopes from the left to the right. That means when your ball lands, it’s going to kick to the right. If you hit the center of the fairway, your ball could end up off the fairway in a matter of a few bounces.

“My target is nowhere in the fairway, it’s actually on the left side of the rough. From there when it lands, it’ll roll back into the fairway,” Braid explains.

If you’re not hitting first, pay attention to the way your playing partners’ tee balls react when they land and use that information to inform your own target line. Doing this simple analysis on each landing area can help you find the fairway more often and ultimately save you a few strokes.

Golf Tip adapted from golfdigest.comⁱ

Recipe Tip of the Week:

Holiday Berry Meringue Wreath

Ingredients

Wreath:

8 large egg whites, at room temperature

1 teaspoon cream of tartar

1/2 teaspoon fine salt

3 1/2 cups confectioners’ sugar

Cranberry Sauce:

One 10-ounce bag fresh or frozen cranberries, thawed and drained if frozen

1/3 cup granulated sugar, plus more to taste

Juice of 1/2 lemon

4 cups fresh raspberries

1/2 cup pomegranate seeds

Leaves from 1 bunch fresh mint

Whipped Cream:

1 cup heavy cream

Directions:

Position an oven rack in the lower third of the oven and preheat to 225 degrees F. Line the back of a baking sheet with parchment. Use a 12-inch bowl as a stencil: Flip it upside down and trace a 12-inch circle onto the parchment. Use a 9-inch bowl to trace a circle inside the 12- inch one. This is the outline of your wreath.
For the wreath: Combine the egg whites, cream of tartar and salt in the very clean bowl of a stand mixer fitted with the whisk attachment. Whisk on medium speed until foamy, about 1 minute. Increase the speed to medium-high and beat until thick and opaque, about 1 minute more. Gradually add the confectioners’ sugar, 1/4 cup at a time, and beat until stiff, shiny peaks form, 13 to 15 minutes.
Build the wreath: Using the template on the parchment as your guide, drop dollops of meringue in a line along the inside of the 12-inch circle. Use a rubber spatula to help clean off your spoon between dollops. Following the 9-inch circle and slightly overlapping the outer ring of meringue, make an inner ring of meringue dollops to fill in the rest of the template. Flatten the meringue slightly with the back of the spoon, making sure to keep a lot of peaks. Bake the meringue until it is dry, crisp, and pearly white on the outside, about 2 hours. Remove from the oven and let it cool completely.
Meanwhile, make the cranberry sauce: Bring the cranberries, sugar and lemon juice to a simmer in medium saucepan and cook until the cranberries are soft and just begin to burst and the sugar is completely dissolved, about 10 minutes. Set aside to cool completely. Gently fold in the raspberries and pomegranate seeds. Whip the heavy cream in a medium bowl until soft peaks form.
Before serving, spread the whipped cream on the meringue. Spoon over the cranberry sauce and sprinkle with mint leaves.

Recipe Tip adapted from foodnetwork.comⁱⁱ

Travel Tip of the Week:

Even If Your Passport Is Currently Valid, You May Not Be Able to Enter These Countries

When planning an international trip, having a valid passport right when you plan to travel may not suffice at the airport. In fact, many countries require passports to be valid months after your intended departure date.

While specifics can vary by country, the small detail can, of course, become a very big problem. Many destinations require travelers to have at least three or six months left on their passport before entering the country, and an airline may not allow travelers to board if they have less than the required amount, according to the U.S. Department of State. Additionally, other destinations — like Canada, Mexico, and Ireland — require passports to be valid at the time of entry or for the duration of a stay.

So when it comes time to planning that dream trip outside the U.S., the State Department advises travelers ensure they have at least six months validity on their passports to avoid snafus, and said those with soon-expiring passports should renew “early to allow for delays.” Currently, passport renewal times are four to six weeks for routine service and two to three weeks for expedited service, and travelers utilizing routine service can now renew online.

These are some of the most popular destinations, grouped by the required passport validity period, according to the U.S. Department of State, to help plan 2025 travel:

Countries That Require Passports to Be Valid at Least 3 Months After Departure Date

Austria
Belgium
Croatia
France
Germany
Greece
Iceland
Italy
Netherlands
New Zealand
Norway
Portugal
Spain
Sweden
Turks and Caicos

Countries That Require Passports to Be Valid at Least 6 Months After Departure Date

Cambodia
China
Egypt
India
Indonesia
Jordan
Kenya
Morocco
Singapore
Tanzania
Thailand
United Arab Emirates

Countries That Require Passports to Be Valid at Time of Entry or for Time of Stay

Argentina
Australia
Bahamas
Brazil
Canada
Chile
Colombia
Costa Rica
Dominican Republic
Ireland
Japan
Mexico
Saint Vincent and the Grenadines
United Kingdom

Travel Tip adapted from travelandleisure.comⁱⁱⁱ

Our mailing address is:

Ballentine Capital Advisors
15 Halton Green Way
Greenville, SC 29607

Sources:

Disclosure:

Ballentine Capital Advisors is a registered investment adviser. The advisory services of Ballentine Capital Advisors are not made available in any jurisdiction in which Ballentine Capital Advisors is not registered or is otherwise exempt from registration.

Please review Ballentine Capital Advisors Disclosure Brochure for a complete explanation of fees. Investing involves risks. Investments are not guaranteed and may lose value.

This material is prepared by Ballentine Capital Advisors for informational purposes only. It is not intended to serve as a substitute for personalized investment advice or as a recommendation or solicitation or any particular security, strategy, or investment product.

No representation is being made that any account will or is likely to achieve future profits or losses similar to those shown. You should not assume that investment decisions we make in the future will be profitable or equal the investment performance of the past. Past performance does not indicate future results.

Advisory services through Ballentine Capital Advisors, Inc.

ⁱhttps://www.golfdigest.com/story/how-to-pick-a-target-from-the-tee-box-with-your-driver

ⁱⁱhttps://www.foodnetwork.com/recipes/food-network-kitchen/holiday-berry-meringue-wreath-3775661

ⁱⁱⁱhttps://www.travelandleisure.com/international-travel-passport-expiration-requirements-8729747