4 Steps to Kickstart a Financial Plan in 2022
The new year is a great time to dot the i’s and cross the t’s on your financial plan. Here are four areas that could use your attention right now.


The start of a new year marks a strategic time to review a financial plan and develop goals to work toward over the next 12 months and beyond. This “fresh start” mentality allows individuals to review and assess what worked (or didn’t) over the course of the previous year and revise or create short- and long-term goals to strengthen their financial plan.
The new year also restarts the calendar from a tax-planning perspective, so it’s beneficial to think through tax-efficient opportunities, such as gifting, retirement contributions and more. Here are four steps to consider that can have a lasting impact on a financial plan both this year and well into the future.
Step 1: Rebalance your portfolio
In addition to reviewing overall goals, the start of a new year also marks a good time to review portfolio allocations. Investors should assess their objectives and risk tolerance to ensure their portfolios are appropriately aligned. This is particularly important now, as a decade-long bull market has likely left unattended portfolios more heavily weighted to equities than intended.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
If overweight in any area, January is a great time to consider rebalancing. I recommend evaluating the portfolio’s asset allocation and rebalancing if the equity or fixed income positions have strayed more than 5 percentage points from their intended targets. An added benefit of rebalancing in January, especially with the markets being strong, is the possibility to defer paying capital gains taxes until next spring.
Step 2: Maximize retirement contributions
IRA contributions can be made until the tax-filing deadline in April, meaning that an investor can use the next 3½ months to maximize their 2021 contributions. Alternatively, for investors making 2022 contributions, they have more than 15 months – or until April 2023 – to fund their accounts. That said, it’s advantageous to invest in an IRA as early as possible in the year to fully benefit from the power of compounding.
Notable for 2022 is the IRS’ decision to raise the contribution limit on 401(k)s, 403(b)s, and most 457 plans to $20,500, up from $19,500 in 2021 (for those 50 years old or older, they can contribute an additional $6,500 in 2022, a figure that remains unchanged from 2021, bringing the total to $27,000). Investors should review their employer-sponsored plan and aim to maximize these contributions or look to see if there is additional cash flow (for example, if an individual recently received a raise) to direct toward retirement accounts.
In general, I advise my clients to contribute at least 12%-15% of their salary, including any employer contributions, to retirement savings. At the very least, contribute enough to earn the full employer match.
Additionally, because it is a new tax year, it could be an opportunity for some investors to consider converting a traditional IRA to a Roth IRA. Depending on an investor’s tax bracket for 2022 in comparison to prior years or anticipated future years, assess whether a Roth conversion in 2022 makes sense. For example, if an investor just retired and has less earned income, they could pay taxes on the Roth conversion at a lower rate than when they were working.
Step 3: Avoid pushing gifting plans until year’s end
Many individuals and families wait until closer to the end of the year to deploy their charitable giving strategy, but 2022 may be a good time to move this action to earlier in the year. Given the market’s strong 10-year run, donors should consider making gifts through appreciated securities, as this technique allows an investor to:
- Rebalance their portfolio.
- Receive a tax deduction.
- And avoid paying capital gains tax on the security donated.
Taking this tactic one step further, a donor-advised fund (DAF) can be funded using appreciated securities, allowing an investor to receive the tax deduction once the vehicle is funded, but “park” the donations in the DAF until they are ready to allocate them to the charity or charities of choice.
Step 4: Understand looming estate tax changes
Individuals may see their lifetime estate and gift tax exemption go from $12.06 million in 2022 to near half of that amid expiring provisions slated for 2026. These changes may be four years away, but until more clarity is provided, investors with an estate plan – or those thinking about creating an estate plan – should connect with their adviser and/or attorney to discuss future provisions and the impact they may have on their plans.
Just as an individual might set fitness or lifestyle goals at the start of the new year, take time to review financial objectives. Financial planning is often a year-round journey, but dedicating focus and implementing actionable plans today can have a significant impact on financial wellness for years to come.
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Julie Virta, CFP®, CFA, CTFA is a senior financial adviser with Vanguard Personal Advisor Services. She specializes in creating customized investment and financial planning solutions for her clients and is particularly well-versed on comprehensive wealth management and legacy planning for multi-generational families. A Boston College graduate, Virta has over 25 years of industry experience and is a member of the CFA Society of Philadelphia and Boston College Alumni Association.
-
Fired Up By the Masters and RBC Heritage? See These Homes for Sale By Golf Courses
Five homes for sale near golf courses, for people who can't get enough of the tour.
By Alexandra Svokos
-
The Economic Impact of the US-China Trade War
The Letter The US-China trade war will impact US consumers and business. The decoupling process could be messy.
By David Payne
-
Will My Children Inherit Too Much?
If you worry about how your children will handle an inheritance, you're not alone. Luckily, you have options — from lifetime gifting to trusts — that can help.
By Mallon FitzPatrick, CFP®, AEP®, CLU®
-
Charitable Giving Lessons From Netflix's 'Apple Cider Vinegar'
Charity fraud is rife, and a Netflix series provides a timely warning about donating money to a good cause without looking into its background.
By Peter J. Klein, CFA®, CAP®, CSRIC®, CRPS®
-
Four Takeaways From Filing Your Taxes to Boost Your Financial Future
Now that another tax season is in the rearview mirror for most of us, what lessons can you take from what you learned about your finances to plan for the future?
By Kate Winget
-
What Claims Adjusters Are Thinking vs What They're Saying
After a natural disaster, few of us are at our best, but here's what to keep in mind when you're interacting with your insurance company's claims adjuster.
By Karl Susman, CPCU, LUTCF, CIC, CSFP, CFS, CPIA, AAI-M, PLCS
-
Looking to Make a Job Change? How to Stand Out Like a Pro
To make a strong first impression in interviews or when networking, skip your job title and work history and use an opening gambit that highlights your talents.
By Anne deBruin Sample, CEO
-
First 100 Days: Trump's Impact on Your Finances
Here are some opportunities to consider regarding investing, interest rates and tax cuts as the financial landscape shifts under the new administration.
By Daniel Razvi, Esquire
-
What Would Happen if You Put Your Tax Refund in an IRA?
Not only could you get a tax break, but the compounding effect over 35 years could turn the average refund into nearly $14,000.
By Romi Savova
-
Children Can't Afford to Fly the Nest? Here's How to Help
The high cost of living means more adult children are staying at home. Here are four ways to help financially so they can eventually spread their wings.
By Kelli Kiemle, AIF®