Updated: Apr 02, 2024

10 Year-End Moves for Your Investment Portfolio

Find out which year-end investment strategies you can consider to improve your overall portfolio for the next year or to boost returns before the year ends.
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The end of the year is a great time to take stock of a lot of things in your life.

New year’s resolutions and goals are common, and many people include financial goals in their list of aspirations.

The end of the year is also a great time to assess your investment portfolio.

You can find opportunities to save some money or simply get a head start on some of the work that goes into managing your portfolio.

1. Get Ahead on Taxes

The end of the calendar year is also the end of the tax year.

You have to pay tax on your investments, whether it be dividends, capital gains, stock options from your employer, or simple bank account interest.

If you do a lot of trading (e.g, day trading), it can be difficult to gather all of the paperwork that you’ll need to file your taxes.

If you have time, go through your records and statements to get all of the information that you need to report your investment gains and losses.

The best part:

It can save you a lot of scrambling when it comes time to fill out your tax return.

2. Max Out Your 401(k) Match

Most employers that offer a 401(k) plan will match some of the contributions that their employees make.

Typically, they will match a certain percentage of your salary if you contribute it to the account.

For example, your employer might match 100% of your contributions on up to the first 3% of your salary.

These matching contributions are like free money, so it’s often in your best interest to max out your employer’s match.

Once the year ends, any lost matching goes away forever, so use your last few paychecks to max out your matching.

After contributing enough for the maximum match, y.ou may consider contributing the maximum limit to take advantage of the tax advantages.

3. Open an IRA if You Don't Have One

Individual retirement accounts (IRAs) give you additional tax-advantaged space to save for retirement.

Traditional IRA Vs. Roth IRA

Traditional IRA Roth IRA
Contributions may be tax-deductible. Contributions are not tax-deductible.
Pay taxes upon withdrawal. Earnings can be withdrawn tax-free and without penalties if the funds were in the Roth IRA for 5 years and you've reached age 59 1/2.
You must be under age 70 1/2 to contribute. You can contribute at any age.
Required minimum distributions (RMDs) are required starting at age 70 1/2. No RMDs required.

They’re also more flexible than 401(k)s are, giving you the ability to choose the brokerage company that you want to work with and the exact investments that you’ll use.

You have up until the day you have to file your taxes to open an IRA, but why wait?

If you don’t have one, open an IRA at the end of the year.

If you already have an IRA, don’t forget to make contributions. You can save plenty of money on taxes and build a solid nest egg for retirement.

4. Review Your Portfolio

Even the most basic investment portfolios need some basic maintenance from time to time. The end of the year is as good a time as any to take a look at your portfolio.

Start by looking at your investments and thinking about your investment goals.

Does your portfolio help you meet your goals?

If you’re getting closer to retirement, you might want to adjust your asset allocation to be more conservative. If you’re looking for more gains, you might want to invest more money in stocks.

Understanding your investment goals and making sure that your portfolio is aligned with your goals is essential to successful investing.

5. Diversify and Rebalance 

Two other important parts of portfolio maintenance are rebalancing and diversification.

Over time, even if you make no changes to additions to your portfolio, your portfolio’s asset allocation could change.

This is because different investments perform differently.

One year, stocks could perform well while bonds fare poorly. In another, stocks will crash while bonds skyrocket.

If you have a goal for your asset allocation, which you should, you should rebalance your portfolio every once in a while.

Sell investments that have performed well to buy more of the investments that have done less well to make sure that your portfolio matches your desired asset allocation.

You invest in individual securities, it’s also a good idea to diversify your investments.

If one company’s stock posts huge gains, you might want to reinvest some of that money in other businesses so that your portfolio isn’t too closely tied to the fate of one company.

6. Plan for Next Year

As the year comes to a close, take the time to sit down and put together a plan for the next year.

Examples of items to review:

  • Did you max out your 401(k) matching this year?
  • Were you able to contribute as much to your IRA as you wanted to?
  • Do you have a goal to save for, such as buying a home or a car?

Figure out your goals for the next year and then come up with a plan for meeting those goals. Setting up automated savings transfers is a great way to increase your savings.

You could even set up direct deposit to your savings account or increase your paycheck contributions to your 401(k).

Whatever your goals, coming up with a plan for how to achieve them will put you on the right path.

7. Cut Down on Investment Costs

If your investments didn’t perform as well as you hoped over the past year, you might consider ways to reduce investment costs.

One good way to do this is to choose funds with lower expense ratios.

If you have money in expensive mutual funds, try moving it to index funds that have lower fees.


If you’re a regular stock trader, look for brokerage accounts with lower commissions.

Regular traders could be incurring a ton of fees for their investment transactions. Opt for a discount brokerage that serves your investing needs.

8. Consider End of Year Stock Donations and Charitable Giving

Many gift-giving holidays happen at the end of the year, so it’s a great time to think about making an end of year donation to a charity that you like.

If you do want to make a charitable donation at the end of the year, one of the best ways to do it is by donating stocks that have appreciated.

By making donations of stock rather than cash, you get to avoid the capital gains taxes that you’d incur by selling the stock.

You’ll also get to deduct the full value of the stock that you donated. This is like getting a double benefit from a single donation.

9. Tax-Loss Harvesting

Another way that you can reduce your tax bill is to do some tax-loss harvesting at the end of the year.

When you sell an investment for less money than you purchased it, you have incurred a capital loss.

When you report your income on your taxes, you can subtract your capital losses from your capital gains, reducing the taxes that you have to pay. If you have more losses than gains, you can subtract a portion of your losses from your regular income as well.

Tax-loss harvesting is the process of intentionally selling investments at a loss to take advantage of the tax reduction.

So long as you don’t repurchase a substantially similar investment within 30 days, you can report the capital loss.

If you use a robo-advisor, the software probably does this for you.

Even if you don’t use a robo-advisor, taking the time to do it manually can save you some money.

10. Evaluate Your Overall Finances

Your investments make up a part of your entire financial health -- though they may comprise a large portion.

It's important to evaluate how your overall money situation affects your ability to continue investing for the future.

Consult a Financial Advisor

Whenever you have questions about your investments or personal finances, reaching out to a financial advisor is a great idea.

Financial advisors are professionally trained to help you make the most of your money and to help you choose the right investments and financial path for your goals.

Even if you already have a plan, a financial advisor can be a second set of eyes that can point out flaws or find additional opportunities.

As you build your relationship with your advisor, they’ll be able to provide advice that will keep you on track for reaching all of your financial goals.