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As the holidays are nearly upon us, 2011 will be over before you know it. Even if you're looking forward to next year being better than this one, you have to make sure you do everything you can to salvage the rest of November and December and put yourself in the best position to take advantage of 2012.
So before any more time passes, be sure to take a look at the following areas:
1. Make the most of your retirement savings
You know you need to save more for retirement. But in a slow economy, you may not have the income you used to have in order to contribute to a retirement account, or unexpected expenses may have sapped your savings before you had a chance to get your money safely squirreled away.
But if you can afford it, time's running out to get money into a 401(k) or other employer-sponsored retirement plan by the end of the year. With the ability to save up to $16,500 in a 401(k) this year -- and $22,000 if you're 50 or older -- tax-favored retirement accounts are the best way to get an upfront tax deduction this year as well as boost your financial prospects for your retired years.
That's especially true if your employer matches your 401(k) contribution. And if you haven't checked on employer matching lately, you should -- several employers that cut their matches temporarily, including Ford (NYSE: F ) , Eastman Kodak (NYSE: EK ) , and UPS (NYSE: UPS ) , have restored them, once again giving workers the chance to get some help saving for retirement.
But unlike IRAs, for which you have until next April 15 to contribute, 401(k) contributions have to get done by the end of the calendar year. So if you have to pick between your 401(k) and your IRA, go with the 401(k) -- especially if you get a match.
2. Flex your financial muscles
One way smart workers save on medical bills is by using flexible spending accounts. These employer-sponsored benefits let you put money aside to spend on medical needs on a pre-tax basis. But if you don't use the money each year, you lose it.
Many companies give you extra time beyond the end of the year to spend flex money, but not all do. So if you have a flex account, check with your employer to find out when you have to have that money spent -- and then whether you decide to get a new pair of glasses or finally schedule that long-put-off checkup, make sure you don't let that money go to waste.
3. Check your investments
In a year where the major stock indexes are slightly down, many people don't even bother looking at their brokerage statements. But if you neglect some things, it could end up costing you even more.
For instance, even with the Dow up minimally and the S&P 500 down for the year, bond investments like iShares Barclays TIPS Bond (AMEX: TIP ) and iShares Barclays 20+ Year Treasury (AMEX: TLT ) have jumped substantially -- the latter is up more than 30%. Those disparate gains mean that your overall asset allocation may be out of balance, making you overdue to rebalance your portfolio. If you don't, then you'll be overexposed to bonds -- and if they drop, you could see all those gains evaporate as if you'd never had them.
The same goes for high-flying stocks. Ask investors in Green Mountain Coffee Roasters (Nasdaq: GMCR ) or Netflix (Nasdaq: NFLX ) if they wish they'd grabbed at least some of their profits while they'd had the chance, and most would jump at the chance. Rebalancing isn't about deciding whether a stock is smart or dumb to own -- it's just about managing risk in your portfolio and making sure you don't have too many of your eggs in one basket.
4. Think about taxes
Even with April five months away, it's not too early to think about taxes. Strategies like tax-loss selling and front-loading deductible items into 2011 can save you thousands of dollars come tax time, and it's far easier to plan for taxes now than it is on April 14.
Make the list and check it twice
So don't wait another minute to get started on your financial to-do list. Just like shopping days before Christmas, the time you have before the end of 2011 will disappear before you know it -- and the sooner you get these things done, the more you can focus on enjoying the rest of the holiday season.
Saving for retirement is hard, but it's not impossible if you have the right help. Learn everything you need to know to retire richer from the Fool's newest free special report, "The Shocking Can't-Miss Truth About Your Retirement."
Tune in every Monday and Wednesday for Dan's columns on retirement, investing, and personal finance. You can follow him on Twitter here.