Retirement Planning Checklist to Prepare for 2021

23rd Nov 2020

Checklist with blue checkmarks

This year has been a year like no other. The world is in the midst of a global health crisis, the stock market has experienced dramatic ups and downs, and economic uncertainty continues to impact business forecasts. Because of the economic flux, it’s important to think about retirement planning. A year-end retirement planning checklist will help you make long-term financial decisions, especially with new tax and retirement considerations related to the COVID-19 pandemic. If you want to lower your tax liability, now is an ideal time to potentially get ahead in tax planning, which is even more critical in wake of an unpredictable economy.

Here’s a suggested year-end checklist for retirement planning to help you take advantage of ways to save on taxes.

Maximize Annual Retirement Contributions

Are you taking advantage of workplace retirement accounts? If not, you may want to consider increasing contributions to maximize employer matches. Tax-advantaged retirement accounts are opportunity to save for the future. The earlier you start, the more money you will reap: the power of compounding can turn small contributions into life-changing wealth.

Evaluate Marginal Tax Rates

People on the threshold of a tax bracket may go to a lower bracket by deferring some income to 2021. If you itemize deductions, consider accelerating deductions such as medical expenses or charitable donations into 2020 instead of paying for deductible items in 2021.

  • The 37 percent marginal tax rate affects taxpayers with taxable incomes more than $518,400 (individual), $622,050 (married filing jointly), $518,400 (head of household), and $311,025 (married filing separately).
  • The 20 percent capital gains tax rate applies to taxpayers with taxable incomes more than $441,450 (individual), $496,600 (married filing jointly), $469,050 (head of household), and $248,300 (married filing separately).

Make Charitable Donations

Donating to a charity may be a good strategy to reduce taxable income. Consult with your financial advisor to explore gifting options.

Retirement Planning for 2021

If you’re high income and self employed, a Defined Benefit or Cash Balance plan may be idea for you. Defined Benefit plans allow small business owners to make high contributions – $100,000 or more – and take a substantial tax deduction.

If you’re interested in opening a Defined Benefit or Cash Balance plan, here are some steps to get started:

  1. Decide how much money you want to save. Do you want to maximize your savings and tax deductions or is there a certain amount of money you seek to contribute each year?
  2. Get an estimate of your contribution. Run a free calculation to see your annual contribution to a Defined benefit or Cash balance plan based on actuarial formulas.
  3. After we have designed a tax retirement plan to meet your retirement objtecives, complete a Plan Design Questionnaire.
  4. After your Defined Benefit plan has been created, you can open an investment account at any brokerage, mutual fund company or through a financial advisor.


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