Post-New Year Checklist: A Fresh Start for Your Finances

by Shinaola Atoro, CFP®
January 24, 2024
stock option planning

As the new year festivities wind down, and we step into the fresh canvas of the new year, it’s a prime moment to take stock of your budget and financial aspirations. Many people have year-end bonuses and stock options to consider or perhaps have upcoming performance bonuses to plan for. Let’s explore strategies for prudent financial management to pave the way for a prosperous future.

How to Make Your Bonuses Work for You

  1. Assess Your Financial Goals
    Before you decide how to allocate your year-end bonus or stock options, take a step back and assess your financial goals. Are you looking to save for retirement, pay off debt, invest in your child’s education, or purchase a home?

    Tip from an Advisor:  Start by writing down your short-term and long-term financial goals. Clear objectives provide a roadmap for your financial journey.

  1. Prioritize Debt Reduction
    If you have high-interest debts such as credit card balances or personal loans, consider using a portion of your bonus to pay down these debts. Reducing debt not only lowers your financial stress but also frees up more of your income for future investments and savings.

    Tip from an Advisor:  List your outstanding debts, including interest rates and minimum payments. Allocate a portion of your bonus to pay off high-interest debts first. Consider creating a debt reduction plan to track your progress.

  1. Boost Your Emergency Fund
    Financial emergencies can happen at any time. A well-funded emergency fund is your safety net in times of loss of income or unexpected expenses like medical bills or car repairs, etc. Allocate a portion of your bonus to beef up your emergency fund, aiming for at least three to six months’ worth of living expenses.

    Tip from an Advisor:  Calculate your monthly living expenses and aim to save three to six months’ worth. Take it a step further and set up an automatic transfer from your paycheck into your emergency fund to ensure consistent growth.

  1. Contribute to Retirement Accounts
    Investing in your retirement is one of the most important financial decisions you can make. Consider maximizing your contributions to retirement accounts such as your 401(k) or IRA. If your employer offers a matching contribution, try to contribute enough to get the full match; it’s essentially free money for your retirement.

    Tip from an Advisor: Read our recent year-end insights so that you’re ahead of the game for 2024.

  1. Diversify Your Portfolio
    If you have received stock options, consider diversifying your investment portfolio. While it’s essential to believe in your company’s potential, overconcentration in a single stock can be risky.

    Tip from an Advisor:  A diversified portfolio can provide stability in turbulent markets. Consult with a wealth advisor to create a diversified investment strategy that aligns with your long-term goals.

  1. Tax-Efficient Investing
    Year-end bonuses and stock options can have tax implications. Explore tax-efficient investment strategies to minimize your tax liability.

    Tip from an Advisor:  Work with a tax expert or financial advisor to explore tax-efficient investment strategies. Tax considerations can significantly impact your overall returns; optimizing them is a smart financial move.

  1. Consider Philanthropy
    If you’re in a comfortable financial position, consider giving back to your community or supporting causes you’re passionate about. Charitable donations can provide tax benefits and make a positive impact on those in need.

    Tip from an Advisor:  If you’re charitably inclined, research charities aligned with your values. Consult with a financial advisor to maximize the impact of your charitable contributions through tax-efficient strategies like donor-advised funds or charitable trust planning.

  1. Consult a Wealth Advisor
    One of the best ways to make the most of your year-end bonus or stock options is to consult a wealth advisor. At Mission Wealth, our dedicated financial professionals are well-equipped to provide personalized guidance tailored to your unique financial situation and goals. We understand the importance of making sound financial decisions and can help you create a comprehensive plan that aligns with your aspirations.

    Tip from an Advisor: Schedule a meeting with a wealth advisor for free today.

Receiving a bonus or stock option is an opportunity to take significant steps toward securing your financial future. By prioritizing responsible financial choices, such as debt reduction, retirement planning, and diversified investments, you can maximize the potential of these financial windfalls. Remember, it’s not just about the present; it’s about building a solid financial foundation for the years to come. Consult with an experienced wealth advisor to make informed decisions and embark on a path to financial success.

Invest wisely and let your bonuses work for you.

Financial Guidance For Your Life Journey

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Contact Us Today

Guidance For Your Full Financial Journey

Through our comprehensive platform and expertise, Mission Wealth can guide you through all of life's events, including retirement, investment planning, family planning, and more. You will face many financial decisions. Let us guide you through your options and create a plan.

Mission Wealth’s vision is to provide caring advice that empowers families to achieve their life dreams. Our founders were pioneers in the industry when they embraced the client-first principles of objective advice, comprehensive financial planning, coordination with other professional advisors, and proactive service. We are fiduciaries, and our holistic planning process provides clarity and confidence. For more information on Mission Wealth, please visit

To meet with a Mission Wealth financial advisor, contact us today at (805) 882-2360.

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