It's hard to believe that 2025 is on its way out. But now that December has arrived, a lot of people are busy doing holiday shopping and making plans to ring in the new year.
At a time like this, it's important to keep a few key financial moves on your radar. Here are some tasks worth tackling as a retiree before 2025 comes to an end.
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1. Review (and rebalance) your portfolio
If you're at a stage of life when you're reliant on your investment portfolio to provide you with income, then it's more important than ever to stay on top of it. Now that 2025 is coming to a close, take the time to review your holdings.
It may be that you're overloaded on certain stocks due to their strong performance this year. If that's not something you're comfortable with, you may want to capture some gains and invest that money in assets with more stability.
Or, it may be that your portfolio isn't producing as much income for you as you'd like. If you're unhappy with its performance, it may be time to add more stocks or exchange-traded funds (ETFs) to your personal investment mix.
2. Take your RMD to avoid a penalty
If you have your retirement savings in a Roth IRA or 401(k), then you don't have to worry about taking required minimum distributions, or RMDs. But if you have a traditional IRA or 401(k) plan, you may have to take an RMD this year. And unless it's your first one, the deadline to do so is Dec. 31.
Failing to take an RMD typically results in a 25% penalty, which is not something you want. So now's the time to log into each of your retirement accounts to see what RMD, if any, you have to take.
Keep in mind that if you don't need the money from your RMD, you could always donate it to charity instead. A qualified charitable distribution allows you to avoid taxes on your RMD while satisfying that requirement.
3. Create a 2026 budget based on your upcoming Social Security raise
In 2026, Social Security benefits are getting a 2.8% cost-of-living adjustment. If those benefits are a big part of your income, then now's the time to figure out how much more money you're in line for in 2026 so you can adjust your budget accordingly.
Keep in mind that Medicare Part B premiums are rising in 2026. If you're enrolled in Medicare, that increase is apt to reduce your COLA.
If you're running the numbers and realize you're not happy with your monthly income, you can come up with a plan to supplement your Social Security in 2026. That could mean getting a part-time job with regular hours or joining the gig economy for an earnings boost.
4. Revisit your estate plan
Perhaps you created an estate plan at the start of retirement and haven't revisited it since. Now's a good time to check all of your accounts to make sure the right beneficiaries are listed and review your estate-planning documents to make sure they still align with your wishes.
Keep in mind that if you've had any additions or changes to your family this year, you may need to update some estate-planning paperwork to reflect that. For example, the birth of a grandchild could warrant an update to your will or living trust. And if one of your children has gotten a divorce, those documents may need to be updated as well.
The end of a calendar year is a great time to get your financial house in order. Make these moves so you can approach 2026 feeling good about the state of your finances.
