Year-end is quickly approaching and you don’t want to miss out on any important money moves before the year closes out! In this episode, I provide important reminders and tips for your finances to end 2021 on a positive note and put you in a fabulous position to achieve your money goals in the new year.  

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I am a financial professional, who specializes in helping people to achieve their financial goals.  My absolute passion is creating new possibilities in people’s lives by showing them the ropes when it comes to money. I’m here to spark healthy and positive conversations around wealth and investment and create a world where nobody is limited by their financial situation. I believe this begins with education and shifting our relationships with money. I love getting to witness people achieving their most ambitious goals and creating new possibilities for themselves and their families! 

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Welcome to the wealth and wellness podcast with

me Kaylie Bob air, I specialize in helping people to achieve

their financial goals. I have a love for all things numbers, and

I'm passionate about financial literacy. My goal is to spark

healthy and positive conversations around wealth and

investment, and create a world where nobody is limited by their

financial situation. But wealth is just one piece of the

equation of living our best lives. So join me as we explore

both wealth and wellness topics. From your net worth to your self

worth, get ready to take confident action.

Hello, this is Kaylee. And thank you so much for tuning into this

episode of the wealth and wellness Podcast. Today, I

wanted to do a quick chat now that we're quickly approaching

the end of the year. And I wanted to share a few money

reminders and tips for year end. That way, it feels like you're

ready to close off 2021 On a good note, and have a good start

for 2022 when it comes to your money. So, of course, it's been

an interesting few years for all of us navigating the pandemic.

And I think just to start off, though, I want to say it's

important to give yourself grace, because I think in this

time, that's of course, very unprecedented. And, you know,

everyone was impacted in different ways. And that very

much could have overlapped with your money and finances, when it

came to how people's jobs were impacted, and their income as a

result, and then savings rates and things like that. So it's

been a very interesting few years to say the least. And I

think just to start off, I, you know, I think we all need to

give ourselves a pat on the back for dealing with all this and

you know, getting through a lot of this unplanned scenarios that

have maybe thrown some of your financial plans and, and money

goals for a bit of a loop. But again, hopefully, this is a good

sort of tips and reminders for you. So you feel like you're,

you know, ready to go. You're doing what you can as far as

what you can control with your money. So let's talk about money

tips for the year. And I'll give you a bit of a disclaimer. Just

to start off, this is going to be more of a Canada focused

topic. And some of the tips are going to be very much Canadian

focused on types of accounts and things like that, just because I

reside in Canada. And so I work with a lot of people in Canada

as a result. So I wanted to get really specific for what some of

these deadlines and things like that are. Okay. So to start off,

let's first talk about TFSA as tax free savings accounts. So

those are a you know, very important piece of people's

wealth building goals and an account that most Canadians that

are able to have these accounts generally are utilizing their

tax free savings accounts or so I wanted to talk about those. A

good reminder for year end for Tax Free Savings accounts is

just if you are planning on withdrawing from your Tax Free

Savings Account, consider doing so prior to year end. Because

you any amounts you withdraw before the year end, you

actually get that contribution room back as of the next year.

So if you do it in January, let's say you're been

considering it, there's something coming up that you

need to pay for. And you've been considering taking money on the

TFSA to cover it. Well, good idea might be to take it now

that we're in December nearing year end, rather than taking it

in January. Because let's say for instance, you took out

$10,000 This December from your Tax Free Savings Account. Well

come January 1 2022, you get the additional 6000 room that

everyone's been given for 2022. And again, this is if you're 18

years or above, that's a little reminder as well for TFSA is so

again, so come January 1 2022, everyone gets that additional

6000 room. But because you took out 10,000 From yours in 2021 as

of January 1 2022, you actually get that $10,000 room back so

your contribution room in that scenario, as of January 1 2022

would actually be $16,000. So again, it's just gives you a

little bit more flexibility in being able to replenish your

TFSA account. If you were to make the withdrawal in January

for instance. So let's say instead you held off, you pulled

out that $10,000 In January while you have To wait until the

following calendar year before you get that room back. So

again, December is just a nice sort of year and Mark, because

you get that room back really quick, come January, you already

have the room given back to you to be able to replenish that if

that's the plan. So again, just for flexibility purposes, might

be wanting to consider it now rather than later. Because like

I said, if you do withdraw in January, for instance, you will

not get that room back. So let's say you make the withdrawal of

$10,000, from your TFSA in January, you will not get that

room back until January of 2023. So you have to wait the full

year. So a lot less waiting if you're wanting to do it before

year end. So again, just something to consider for your

TFSA accounts for year end, reminders and things like that.

So now let's chat about another important account RRSPs are

Registered Retirement Savings Plans, and making contributions

to those. So the great thing about RRSPs is if you are

planning on making a contribution to your RSP, which

you would want, which you'd like to claim on your 2021 tax, you

can actually do so by the end of this year. But you also have the

first 60 days of the following year. So the first 60 days of

2022, as well. So you do have flexibility, and it's not as

urgent to get this done by year end. But you might want to start

giving some thought about okay, how much do I want to make sure

I'm making for my Rs contra RSP contribution, have I put aside

that much savings, you know, where's that money coming from?

If I do want to do it in the first 60 days. So again, you

know, those that start of a new year, things move fast. So it's

a good time to give some consideration at least to if

you're making that contribution. Again, the deadline at the end

of the year is not as it's not really the deadline deadline,

because you do have the first 60 days of 2022. So not a year end

deadline on that, but one you might want to start giving to

some consideration to so you're not left scrambling at the very

last day to make those contributions.

Okay, so another topic that relates to investment accounts

are ESPs. So Registered Education Savings Plans, these

accounts are a fabulous way to save for your children's post

secondary education, your contributions put into an RRSP

account, they grow tax sheltered while they're in the account,

and the government matches your contributions at 20%. up to 500

per year, or they allow up to a one year of catch up. So that

would mean technically up to 1000 per year if you're catching

up on a previous year that you have not received the grant for

so the year end is an important time to consider for this, if

you are looking to max out your government grant contributions

per child. That means that if you make a contribution of 2500,

in the year 2021. So before the end of the year, the government

will match you at the $500 they'll put it and so that's

20%. Again, deadline being important because you can only

catch up on one year of grant per year. So if you keep pushing

this off, you start to lose that ability to catch up on yours

because each year, you're only given the ability to go back and

catch up on one year. Okay, so that's all I had to say I think

for account specific. Now let's talk about tax loss selling. So

this is only going to be applicable on taxable accounts.

So retirement savings accounts, tax free accounts, this is not

applicable for at all. So this what I'm going to talk about now

with tax loss selling or capital gains. Again, it's only

applicable on non registered account investment accounts. So

we have a few different names they go by so non registered

investment account, those are kind of the most common. So

that's what the this would be applicable for. And first off,

just to disclaimer, I'm not here to give tax advice. So you do

want to check with your accountant when it comes to

consulting on your tax position. And if it makes sense for you to

crystallize any losses or gains. Just scenario for an instance of

how this would work is maybe for instance, your income this year

is lower, maybe it was impacted by the pandemic or something

like this. And for this year, your income is lower. So you

might want to see, you know, being that is lower this year

and you think it's going to be higher in future years. You

might want to sell some your positions in your account again

in that non registered account that have increased in value,

because those will trigger a capital gain. So let's say you

bought a stock at $5. It went up to $10 over the time you've held

it. So once you go to sell it there's that $5 gain on each

share that you will have purchased of that stock. So you

will be subject to tax, and you're taxed at 50% of your

capital gains. So again, if you're in a year where your

incomes a little bit lower, you might say, Hey, I better take

those gains. Now, because I do foresee my income getting higher

in later years. Again, something you might want to consult with

your accountant for. So this is not giving advice, specifically

because it is very dependent on each person, and your tax

bracket and things like that. Or another reason to consider is

tax losses. So let's say you've already made some sales in your

accounts. Throughout the years, you've sold some stocks, maybe

you've had some positions that have gone up in value, it's been

a good couple years, since the dip in the markets from the

pandemic markets have come up quite a bit since then. So maybe

you've made some cells in your non registered account, and

you've triggered some capital gains, or, and so you already

have these gains for the year and you go Yeah, you know, I

want to see if I can offset those at all, to kind of bring

down that tax implication, well, you can look at your account and

see if there's any positions that are at a loss position. So

let's say you bought a stock at $20. And now it's trading at

$15. So you might want to also consider selling it at a loss.

And that way you can use your loss against any capital gains.

And the great thing about losses too, is you can actually carry

those forward to future years as well, if you don't have a use

for them this year, so might be something to consider to

triggering some of those losses in your account. If you want to

just sell those positions, realize the losses. The last day

for tax loss selling stocks is December 29. Because there's a

two day settlement from when you sell a stock. So that means they

will settle prior to the year end. If you sell them after that

date, they settle in January. So it technically is not in 2021,

it would be for the 2022 tax year. So make sure you do this

prior to that December 29 deadline.

And that ensures that it can be used on your 2021 taxes. And

keep in mind as well, if you are looking to buy back in either

position. So let's say maybe you sold something at a loss to

recognize the gain. But you still like that stock and you

want to have it in your portfolio. Well, you have to

wait at least 30 days before repurchasing it otherwise, you

could it would be considered having done like a superficial

loss, they call it and essentially, that original loss

you took no longer applies because you bought the position

right back and you bought it back within the 30 days. So do

wait the 30 day time period, before buying that exact

position back. If it's a completely different stock, this

is not applicable. Again, it's if you're buying the same

position pack, you have to wait 30 days to make sure that you

can still utilize that loss for tax purposes. And yeah, just

keep in mind that December is the month where people like to

do these tax losses and things like that for tax purposes, even

institutional investors for things like mutual funds and

pension funds and things like that. So it's kind of just

something to keep in mind with the maybe volatility and what

goes on in December again, you know, not saying for sure how

that's going to impact the markets. But that could be one

of the factors that are impacting markets in December.

So just keep that in mind. Another diligent strategy for

year end is to check in with your financial goals. So I like

using the year end is just that, you know, that reminder that

point to just reflect review. And if you work, so if you're

doing this independently, you know, maybe it's taking some

time sitting down, reviewing your goals, checking to see you

know, if you're still on track, has anything changed, Is there

things you want to update as far as what you're looking to

achieve? Maybe you've added some goals for the coming year, like

a big trip that you've been wanting to do for a while and

putting off and that you're optimistic that might be able to

happen in the next any year or so. So things like that, make

sure you do take some time, reflect review. If you work with

a financial professional, it's a great opportunity end of the

year to just reach out and book review for year end or for early

January to just discuss again, your goals. If anything's

changed. It's just Yeah, year end is a nice sort of reminder

or point to just be be looking in on these things again, in

reviewing and reflecting on where things are at and where

you want to go. What else year end is also a great time to

check in with other important documentation. So documentation

such as your estate plan so your will your power of attorney or

personal directive documentation such as insurance policies,

beneficiaries on your accounts. So If any live changes have

occurred that require an update, so maybe birth of another child,

someone passing away a divorce, any major life event, or maybe

it's just you haven't checked on these in a long time, take that

time to just check in, make sure that they are reflective of your

current plan. And if not, make sure you make those updates. So

if it's an estate plan, you know, maybe it is checking in

with your lawyer to have that updated your will or power of

attorney or personal directive, if something has changed. It is

really important to keep these documents current and with your,

you know, with whatever directives and intentions you

have. So make sure that you are checking in on those important

documents. And again, this might just be the time to remind

yourself of okay, yes, I need to get that done. Another way to

get organized year end, if you have any downtime, so maybe over

the holidays, you have some time of work, and it's your only sort

of downtime that you're foreseeing the next little bit

well, also a great time to get ready for tax season. So instead

of rushing to get this all done at the bitter end, before the

filing deadline, which can be stressful and chaotic, and leave

you scrambling for trying to find all these slips and things

like that, well maybe just start you know, gathering your

receipts right now for your tax taxes coming up. So for 2021. So

gathering receipts, making a list of any items that you would

be expecting for as far as like slips that you're going to be

expecting to hand into your accounting, if you work with a

financial or accounting professional, or if you do it

yourself, maybe making a list of you know, what are the items

that you're going to need. And sort of then you can check them

off as they come in early in the new year. So it's a great time

to kind of be proactive on that. Why not again, if you have the

time if you have a little bit of downtime, great idea to do that.

Also, don't let those benefits go to waste. The deadline for

most workplace health benefits is usually the year end so the

December 31 year end for most plans. So you know those, the

savings accounts and things like that, that you can utilize on

different surfaces like massages and acupuncture, naturopath in,

you know Dental, things like that. Maybe you know that now's

the time, hopefully, maybe you have some time over the

holidays, or if you have some off days where you can schedule

those appointments. And you know, with all the running

around we do during the holidays, perhaps a year end

massage is in order. So make sure you get that done so you

can fully utilize your benefits. What else also keep in mind

deadline for charitable donations for 2020 tax year is

of course December 31 2021 There are so many wonderful causes out

there. And many that really rely on our support especially over

the holiday season. So consider giving to support some of your

favorite causes. And don't forget to get that charitable

receipt because that's going to really help you out come tax

time. And then I can't talk about year end tax or planning

sorry planning in general without addressing the dreaded b

word. So yes, I am talking budgeting December is probably

the most important month I would say that we need to be giving

time and consideration to budgeting and spending. So if

you're not a huge fan of tracking expenses throughout the

year, I get it I'm right there with you. I'm not a big fan. But

you know being diligent about tracking finances over the

holidays is really going to help spare you from that shock of you

know credit card bills come January so spend some time

really deciding you know, what is your budget what is the

budget that you want to be spending on your kids for

presence and you know, other people that you're getting gifts

for for events, things like that again the holidays you know we

have to remember what it's what it's all about and it's about

just you know being around loved one loved ones and you know

being just grateful for things like that for for time with the

people we love and so you know the the pressure of shopping and

buying and getting things is is strong like it's everywhere,

it's all around us it's online shopping and ads we get and

things like that and and of course if we go to the malls and

things like that, but yeah, take some time and do your budgeting

first and and you know put some thought into how much you

actually want to spend in those different categories and that

way you're in control right you're it's not like your money

is just sort of going right out the door and and there's nothing

left after December. But you're you're being diligent about

saying hey, this is what's feasible for me in my budget or

in my you know, with income and things like that right now. No

and, and so that's what you're sticking to. So it's a great

time of any months, December's probably the most important to

really spend some time and get diligent on what your intentions

are about spending and cash flow. So that's it. Hopefully

those were helpful reminders for you. And my goal was not to

overwhelm so hopefully I have not overwhelmed but have you

feeling ready to end your 2021 on a good note with your

finances and be ready, so you're off, you know, for a great start

for 2022 as well. So thank you so much for tuning into this

episode, and I will catch you on next week's episode. All right,

bye.

I hope you found value in this episode. And because I'm such a

proponent of taking confident action, I want to pose a

question to you the listener. What is one action that you feel

inspired to take after listening to today's episode? If you enjoy

listening, please subscribe and share with your friends and

family. Thank you so much and I will catch you next time.