4 Strategic Money Moves Before Year's End Financial Deadlines

The holiday shopping frenzy often distracts people from tackling critical financial tasks that can deliver far greater returns than any seasonal sale. With December 31, 2025 marking the final deadline for several important financial decisions, here’s how to make the most of this end of financial year window to strengthen your 2026 position.

Lock In 401(k) Contributions Before the Clock Strikes Midnight

While IRAs offer flexibility — the IRS allows contributions through April 15, 2026 — employer-sponsored plans like 401(k)s operate on a strict timeline. All contributions must be submitted by December 31, 2025 or your company’s final payroll date of the year. Missing this deadline means losing out on that year’s contribution opportunity entirely, plus forgoing any employer matching funds still on the table. If you haven’t maxed out your retirement accounts, now is the moment to review your payroll elections and boost contributions if possible.

Recalibrate Tax Withholdings To Keep More Money Throughout 2026

Many people celebrate their annual tax refund without realizing it represents an interest-free loan they gave to the government. By overpaying taxes during the year, you’re essentially letting the Treasury use your money while you could have invested it, built emergency savings, or paid down debt. The solution? Submitting Form W-4 adjustments by December 31, 2025 ensures your withholdings align correctly for the full year ahead. There’s no IRS deadline for making these changes, but submitting before year’s end guarantees your paychecks reflect the right amount starting January 2026.

Strategically Sell Losing Investments To Offset Gains

Capital loss harvesting isn’t just for wealthy portfolio managers — everyday investors can deploy this powerful tax strategy before the year closes. By selling underperforming securities at a loss, you can offset gains from your winning investments while cleaning up your portfolio. The bonus: if your losses exceed gains, you can deduct up to $3,000 of losses against your regular income. Any remaining losses carry forward to future tax years, providing ongoing tax benefits.

Finalize Charitable Giving Before December 31 for Tax Credits

Charitable contributions made by midnight on December 31, 2025 qualify for deductions on your 2025 return. The IRS accepts donations via multiple channels — charged credit cards, written checks, or text confirmations all count as long as they’re submitted before year-end. You’re not limited to cash either; stocks, promissory notes, and other assets qualify as well.

For donors age 73 and older, qualified charitable distributions (QCDs) offer an additional advantage by reducing required minimum distributions (RMDs) while maintaining favorable tax treatment on donations. This strategy can meaningfully lower your overall tax liability while supporting causes you care about.

The Bottom Line

The end of financial year presents multiple opportunities to optimize your tax position and strengthen your financial foundation heading into 2026. Whether through retirement account contributions, withholding adjustments, strategic loss harvesting, or charitable giving, taking action before December 31, 2025 ensures you’re not leaving money on the table when the new year arrives.