Year-End Retirement Planning Checklist: 9 Critical Financial Moves Before December 31st, 2025

Essential Tax Strategies and Retirement Account Contributions for Pre-Retirees​

As we approach the end of 2025, pre-retirees and those nearing retirement need to take decisive action on several critical financial planning items. Whether you're 1-5 years from retirement or already transitioning, these year-end strategies can help you maximize retirement savings, minimize taxes, and ensure you're properly positioned for your retirement years.

What Does "Near Retirement" Mean?
Before diving into the checklist, it's important to clarify what "near retirement" means. This isn't limited to people aged 55-60. Some individuals retire at 50, while others work until 70 or beyond. If you're planning to retire within the next 1-5 years, or you're already in your early retirement phase, these strategies apply to you.

1. Review Your Asset Allocation Strategy
The Two-Bucket Approach to Retirement Assets

One of the most critical focuses as you approach retirement is reviewing and adjusting your asset allocation. Many financial advisors have traditionally preached the 60/40 portfolio (60% stocks, 40% bonds), transitioning to 50/50 as you get closer to retirement. However, the reality is that asset allocation should be personalized based on your unique goals, risk tolerance, and financial plan.

What works for most people: A two-bucket strategy with 3-5 years (preferably five years) of conservative dollars set aside in one bucket, and a growth-oriented bucket for the remainder of your portfolio.

Why the Two-Bucket Strategy Works
This approach helps hedge against both emotional decision-making and market downturns. Looking back at the 2008 financial crisis, it took roughly five years for the market to recover from its peak back to that same level. During such downturns, you can:

• Pull income from your conservative bucket without touching battered stocks
• Allow your growth investments time to recover
• Replenish your conservative bucket once markets recover
• Continue pulling from the growth bucket as markets trend upward

This strategy protects you from selling investments at a loss during market volatility while maintaining the growth potential necessary for a 20-30+ year retirement.

2. Rebalance Your Portfolio
Once you've established your two-bucket strategy, regular rebalancing becomes essential. As you prepare for or navigate early retirement, ask yourself:

• Where is the market right now?
• Do I need to replenish my conservative bucket because I've been drawing from it?
• Is the market down, suggesting I should hold off on rebalancing?
• Are my buckets still aligned with my income needs and risk tolerance?

Year-end is an excellent time to review these questions and make strategic adjustments that position you properly for the coming year.

3. Implement Tax Loss Harvesting
Tax loss harvesting is a powerful year-end strategy that can help reduce your tax burden. As December 31st approaches, evaluate:

• Do you have unrealized losses in taxable brokerage accounts?
• Can you harvest losses to offset capital gains from this year?
• Are there losses that can offset other income (up to $3,000 annually)?
• Can you carry forward excess losses to future tax years?

Important: Work with a CPA or tax professional to ensure you're implementing tax loss harvesting correctly and in tune with your overall tax strategy. The IRS wash-sale rule prohibits buying a "substantially identical" security within 30 days before or after the sale, so proper planning is essential.

4. Evaluate Roth Conversion Opportunities
Roth conversions can be a game-changer for long-term tax planning, but timing is everything.

Consider Roth conversions if:

• Your income is unusually low this year (perhaps due to furlough, job change, or early retirement)
• You expect to be in a higher tax bracket in future retirement years
• You want to reduce future Required Minimum Distributions (RMDs)
• You're creating a tax-free inheritance strategy for heirs

When to Avoid Roth Conversions
If you're still working with a high income and expect lower income in future years, it may be wise to wait. Roth conversions work best when you can convert at lower tax brackets. With recent tax legislation providing clarity on tax rates and standard deductions, now is a good time to model different conversion scenarios with your financial advisor.

Remember: Roth conversions are not appropriate for everyone. They require careful analysis of your complete financial picture, including current tax bracket, future income expectations, and overall retirement plan.

5. Maximize IRA and Roth IRA Contributions
2025 Contribution Limits
For 2025, you can contribute:

• Under age 50: $7,000 to an IRA or Roth IRA
• Age 50 and above: $8,000 to an IRA or Roth IRA

Critical Deadline Information
Unlike 401(k) contributions, IRA and Roth IRA contributions can be made up until the tax filing deadline (typically April 15, 2026 for 2025 contributions). When making contributions in 2026, clearly designate them for tax year 2025.

Important Income Limitations
Traditional IRA: If you're contributing to a 401(k) and your income exceeds certain thresholds, your IRA contribution may not be tax-deductible.
Roth IRA: Direct Roth IRA contributions have income limits. High earners may be phased out entirely. However, the "backdoor Roth IRA" strategy may be available—consult with your financial advisor about whether this approach makes sense for your situation.

6. Take Full Advantage of HSA Accounts
If you have a High Deductible Health Plan (HDHP), Health Savings Accounts (HSAs) offer one of the most powerful triple tax benefits available:

1. Tax deduction when you contribute
2. Tax-free growth on investments within the account
3. Tax-free withdrawals for qualified healthcare expenses

HSA Strategy for Pre-RetireesMany people don't realize you can pay for healthcare expenses out-of-pocket now, save your receipts, and reimburse yourself from the HSA years later. This allows your HSA to grow tax-free for decades, essentially functioning as an additional retirement account.
As healthcare costs continue to rise, maximizing HSA contributions in your final working years can provide significant tax savings and create a substantial healthcare nest egg for retirement.

7. Maximize 401(k) Contributions2025 401(k) Contribution Limits

• Under age 50: $23,500
• Age 50-59: $31,000 (includes $7,500 catch-up)
• Age 60-63: $34,750 (includes enhanced $11,250 catch-up)
• Age 64+: $31,000 (standard catch-up returns to $7,500)

Minimum Strategy: Get the Employer Match
At an absolute minimum, contribute enough to receive your full employer match. This is free money—an immediate 50-100% return on your contribution depending on your employer's match formula. Far too many pre-retirees mistakenly stop contributing because they're "close to retirement." Don't leave this money on the table.

Critical December 31st Deadline
Unlike IRA contributions, 401(k) contributions must be made by December 31st. Ensure your final paycheck of the year processes before year-end. If your final paycheck and its withholding fall into the following year, you may miss the contribution deadline for the current tax year.

Action item: Review your year-to-date contributions now and adjust your final paychecks to maximize contributions before December 31st.

8. Review and Update Beneficiary Designations
Year-end financial reviews provide the perfect opportunity to verify that your beneficiary designations align with your current wishes. Review beneficiaries on:

• 401(k) and 403(b) accounts
• Traditional and Roth IRAs
• Life insurance policies
• Annuities
• Bank and brokerage accounts with TOD (Transfer on Death) or POD (Payable on Death) designations

Why This Matters
Beneficiary designations supersede your will. Outdated beneficiaries can create unintended consequences, family disputes, and unnecessary taxes. Common situations requiring updates include:

• Marriage or divorce
• Birth or adoption of children or grandchildren
• Death of a previously named beneficiary
• Changes in your estate planning strategy
• Changes in family relationships

Take 30 minutes to review these designations across all accounts. It could save your family significant stress and money.

9. Comprehensive Estate Planning Review
As you near retirement, estate planning becomes increasingly important. Use this year-end review period to:

• Review and update your will
• Verify your power of attorney documents are current
• Ensure healthcare directives and living wills reflect your wishes
• Consider whether trust structures might benefit your situation
• Review your overall estate tax situation
• Discuss your plans with family members to avoid surprises

Estate planning isn't just for the wealthy. Everyone needs basic documents in place, and those nearing retirement should ensure these documents are current and properly executed according to their state's laws.

Year-End Retirement Planning Action Steps
As you work through this checklist, remember that everyone's situation is unique. Not every strategy will apply to every person, and some may require modifications based on your specific circumstances. Consider this your starting framework for year-end retirement planning conversations with your financial advisor and tax professional.

Your December Action Plan

1. Week 1-2: Schedule meetings with your financial advisor and CPA
2. Week 2-3: Review asset allocation and implement rebalancing
3. Week 3-4: Execute tax loss harvesting and Roth conversion strategies
4. Before December 31st: Finalize all 401(k) contributions and HSA funding
5. Before year-end: Update beneficiaries and review estate documents
6. Before April 15th, 2026: Complete IRA and Roth IRA contributions for 2025

Common Year-End Retirement Planning Mistakes to Avoid

• Waiting until December 30th to act – Some strategies require time to implement properly
• Making emotional investment decisions – Stick to your plan during market volatility
• Ignoring the employer match – Never leave free money on the table
• Forgetting about the December 31st 401(k) deadline – Unlike IRAs, you can't contribute after year-end
• Overlooking beneficiary updates – Outdated designations can derail your entire estate plan
• Implementing strategies without professional guidance – Tax and financial rules are complex; work with qualified professionals

Final Thoughts
Year-end retirement planning requires proactive action, not passive waiting. The strategies outlined in this checklist can help you minimize taxes, maximize retirement savings, and ensure you're properly positioned for the retirement you've worked so hard to achieve.
Don't let December 31st pass without taking action on these critical items. Your future retired self will thank you for the time and effort you invest now in proper year-end planning.

​About Jazz Wealth Managers
At Jazz Wealth Managers, we provide award-winning fiduciary financial advice to clients navigating the complexities of retirement planning. Recognized by USA Today and Newsweek for multiple consecutive years for our exceptional service and client-focused approach, our team operates under a fiduciary standard—meaning we are legally and ethically obligated to put your best interests first, always.

Our comprehensive retirement planning services help pre-retirees and retirees make informed decisions about asset allocation, tax strategies, and wealth preservation. As fiduciaries, we provide transparent, conflict-free advice designed to help you achieve your unique retirement goals.

If you're approaching retirement and want personalized guidance on implementing these year-end strategies, we're here to help you create a retirement plan that harmonizes with your financial goals.

Disclaimer: This guide is educational and not individualized financial, tax, or legal advice. For decisions affecting your finances, beneficiaries, taxes, or estate, consult a licensed fiduciary financial advisor, a board‑certified estate attorney, and a qualified tax professional who can evaluate your specific circumstances. This content is for educational purposes only and does not constitute personalized investment advice. Past performance is not indicative of future results. Before making any investment decision, consult with a qualified financial advisor who understands your complete financial situation.