Use it or Lose It
Before the ball drops
Launch 2025 with no regrets over missed opportunities. Lots of great opportunities lie ahead but a few need to be executed immediately. Here are some of the key steps to take before midnight on New Year’s Eve.
Every penny of tax beyond the minimum to avoid jail is an unforced error. Harvest tax losses. Sell shares with a net negative expected value after taxes in taxable accounts. Even better: get Frec to do it for you automatically via direct indexing.
Max out your 401(k). It is good to compound tax efficiently for decades; it is also good to force yourself to live beneath your means. The best way is to never see the money hit your bank account. IRAs can wait until April 15, but you might as well max that out too.
Max out a 529 for every family member regardless of educational plans. Money is fungible and divisible so the entire game is maximizing after tax wealth. The limitations on use can be easily circumvented later.
Empty your Flexible Spending Accounts (FSAs) and fill up your Health Savings Accounts (HSAs). My favorite healthcare expense is Reboot Wellness telehealth for hormone therapy and weight loss. Ask your providers if you can prepay any upcoming bills.
Prepay for subscriptions. One of my favorite subscriptions for 2025 is my StW Special Purpose Research which is half off for a few days so that anyone expensing it can get a good deal in 2024. It is a good deal anyway but a no brainer if your research budget is expiring.
Make a charitable contribution. My favorite charity is Watsi which provides life altering medical care around the world. If you have a massive capital gain in Bitcoin (BTC), you can save lives and taxes by donating some of your crypto here.
Take every advantage to strengthen your finances so you can survive setbacks and seize opportunities. Briefly celebrate the wins and mourn the losses from this year before you prepare to compete at your best in the next. Happy (almost) New Year!
