15 Investing Moves to Make Before the End of 2021

There are only about two months left in 2021. While you might be likely to make some big and important New Year's resolutions come Jan. 1, 2022, you're also likely to not keep them -- relatively few people do. (One study suggests that 80% of resolution makers fail within a month.) So try this instead -- read through the following 15 smart investing moves and act on as many of them as you can by Dec. 31. Then you can start 2022 with a lot of accomplishments already behind you.

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We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by the Motley Fool. I’d be sitting on a gold mine!” And it’s true. And while Amazon and Netflix have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Simply click here to learn how to get your copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

First off, each of us needs some kind of financial master plan, including a retirement plan. We need to list all our financial needs and goals, and then figure out how we will achieve them. It's best to be specific, too -- just saying, "I want to retire with a million dollars" isn't nearly as helpful as saying, "I want to have $150,000 in 10 years, $500,000 in 20 years, and $1 million in 30 years." You'll also need to determine how much you'll have to save and invest each year, and how you'll invest your money.

ALSO READ: 2 Top Growth Stocks to Buy for 2022

You might not think that paying off debt is an investment move at all, much less a smart one -- but it is. If you're paying, say, 20% on, say, $20,000 of credit card debt, you're on the hook for around $4,000 per year in interest payments alone. Pay that off and it's like a guaranteed 20% return -- you'll save $4,000 every year. Better still, once you pay off all that high-interest debt, you'll free up a lot of money for investing.

It's good, now and then, to review the fees you're paying all over your financial life. If your bank is levying hefty fees regularly (perhaps for "account maintenance" or a too-low balance), look into switching banks. If your mutual funds are charging around 1.5% annually (via their "expense ratios") while not delivering market-beating returns, look into moving that money elsewhere.

Make it part of your overall financial plan to boost how much you invest each year, to whatever degree you can. If you're socking away 8% of your income now, aim for 9% or even 10% next year. Don't be afraid to keep going, to 15% or more, because many of us will need to be saving and investing that much if we want to meet our goals -- especially if we started doing so later than we should have.

ALSO READ: My 2 Best Growth Stocks to Buy Now

If you're going to invest in the stock market (and it's hard to find a more effective way to build long-term wealth), be diversified. You may be most familiar with one industry, perhaps because you work in it, but you don't want to have most of your money in companies from that industry, because entire industries can get whacked sometimes, such as in the great financial crisis of 2007 and 2008, when financial services companies fell hard. The recent pandemic hurt most industries, but the travel industry was one of the biggest casualties. It's best to have your portfolio diversified across industries.

5 Winning Stocks Under $49
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by the Motley Fool. I’d be sitting on a gold mine!” And it’s true. And while Amazon and Netflix have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Simply click here to learn how to get your copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

Diversification is in order if you want to pursue fast-growing companies, hoping to get in on the next Netflix or Apple somewhat early in its life. If you only invest in two or three such contenders, you may end up with three underwhelming investments. But if you spread your money across around 25 growth stocks, you'll have a much better chance of ending up with one or more amazing performers -- especially if you hang on for at least five years, giving them a chance to perform. That's our investing philosophy at The Motley Fool.

Growth-stock investing isn't for the faint of heart, as those companies can be very volatile. For ballast, include a meaningful portion of dividend-paying stocks in your portfolio -- or stick with them only, which isn't a crazy thing to do. Dividend payers can be especially powerful performers, too -- offering not only stock-price appreciation over time but regular infusions of cash, too -- which you can reinvest in additional shares of stock. A $400,000 portfolio with an overall dividend yield of 3% will generate $12,000 annually -- a sum that's likely to increase over time.

ALSO READ: 3 Nasdaq 100 Stocks to Buy Hand Over Fist in November

Most of us should give serious consideration to broad-market, low-fee index funds, because they offer a compelling proposition: For very little work, with little to no supervision needed, you'll earn roughly the market's average -- enough to outperform most actively managed mutual funds. You might put all your long-term dollars in one or more index funds and do quite well over the long run.

Here's an investment move that you might not have thought of: converting your traditional IRA, or traditional 401(k) account, to a Roth IRA. Traditional and Roth IRAs differ in the tax breaks they offer you, with Roth IRAs offering tax-free withdrawals in retirement. This isn't the best move for everyone, but it can work well for many. Note that there's a catch: How much you convert will count as taxable income to you -- because money parked in a traditional IRA was never taxed. Once you pay that tax, though, the sum that's now in a Roth IRA can grow with no more taxes ahead. Converting to a Roth IRA can be especially smart to do if the market takes a big dive -- because at that point, your traditional IRA's value is likely to be lower, resulting in a smaller tax hit.

Being a more tax-savvy investor can save you a bundle. For example, if you've sold some stocks for a hefty profit in 2021 and you're facing a big tax hit on those capital gains, you can offset some or all of the gains with losses via some strategic selling of stocks in which you're underwater. Be sure to respect the wash-sale rule, though -- you can always buy back what you sold, but you'll need to wait at least a month and day before doing so.

5 Winning Stocks Under $49
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by the Motley Fool. I’d be sitting on a gold mine!” And it’s true. And while Amazon and Netflix have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Simply click here to learn how to get your copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

In the two months before 2022, you would do well to learn more about value investing -- the style of investing that has made people like Warren Buffett a lot of money. It's all about looking for investments where you're buying at a discount to intrinsic value -- thereby getting a built-in margin of safety.

ALSO READ: 2 Monster Growth Stocks to Buy Now and Hold

While you're at it, learn about growth investing, too, because there's a lot to be gained from it if it's practiced responsibly, ideally with at least some attention paid to valuation. In other words, when you find exciting, fast-growing businesses, don't jump in at any price. Take some time to study the company, assessing its risks and opportunities. Think about where you expect it will be in five or more years -- if it will likely be much bigger.

A lot can be learned by reading up on great investors such as Warren Buffett and Peter Lynch, to see just how they go about thinking about, studying, and investing in companies -- and when and why they might sell. You can read biographies of some of them and read the writings of others. Buffett, for example, produces a long and educational letter to shareholders every year. While you're at it, read up on great businesses, too -- there are many books detailing how various major companies started and grew huge.

For best results in your financial life -- if you're married -- you'll want to be on the same page as your life partner. If you're saving and investing diligently, but your partner keeps buying expensive concert tickets, lottery tickets, or a new car every few years, you'll be swimming upstream. Have regular conversations about your financial goals and how you'll achieve them. Work on them together.

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Finally, don't be afraid to hire a financial advisor to help you with some or all of your finances. A good one should be able to save you much more than they charge you, and they can offer peace of mind and better sleep, knowing that you've got your financial ducks in a row. Don't just go with the first advisor you consult. Gather some recommendations and meet with a few, to see who impresses you most and with whom you have the best rapport. Consider favoring fee-only advisors, as they won't stand to collect a commission from products they sell you on.

5 Winning Stocks Under $49
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by the Motley Fool. I’d be sitting on a gold mine!” And it’s true. And while Amazon and Netflix have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Simply click here to learn how to get your copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

By acting on only a few of these smart moves, you can put yourself on surer financial footing and can be much better positioned for a comfortable retirement. Act on a bunch of them and you'll likely thank yourself years down the road. Remember -- much of your future financial security depends on you.

Selena Maranjian owns shares of Apple and Netflix. The Motley Fool owns shares of and recommends Apple and Netflix. The Motley Fool recommends the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy.