Don’t Wait for January: Your Essential Year-End Retirement Planning Checklist

By: Bob Seibel, Wealth Manager, Merit Financial Advisors

As the year winds down, most people focus on holiday shopping and parties. But for anyone nearing retirement — or already living it — this season isn’t just busy. It’s crucial. Year-end decisions can affect taxes, income, investment risk, and overall confidence for years to come.

Older adults now make up 18% of the U.S. population,  and the average retirement age has climbed to around 62. People are living longer, retiring later, and facing more complex planning decisions than in decades past, which makes this brief window before year-end one of the most important planning checkpoints.

If You’re Already Retired: The Deadline That Doesn’t Budge

For retirees who’ve reached the required minimum distribution (RMD) age (73 if you were born in 1959 or earlier, 75 if you were born in 1960 or later), December 31 is a legal line in the sand. Missing the full RMD amount leads to one of the harshest penalties in the tax code: 25% of the amount not withdrawn, reduced to 10% if corrected within two years. That’s money you don’t need to lose.

Many retirees already take regular withdrawals, but that doesn’t necessarily mean they’ve completed their RMD for the year. And when multiple retirement accounts are involved, the calculation becomes easy to overlook. That’s why having the RMD automated, along with tax withholding, can be one of the simplest and most reliable moves on your checklist. Your financial advisor can help identify the correct amount and schedule the required withdrawal, ensuring the right amount is withdrawn, taxes are withheld, and the IRS deadline is met. It doesn’t remove responsibility, but it does add a layer of certainty when other priorities take precedence.

With Retirement on the Horizon, Time Is Your Biggest Advantage

The years leading up to retirement can be just as critical as the years after it. Advisors often look at a 10-year window as the moment where lifestyle patterns start to stabilize. Spending becomes more predictable. Children have likely moved out and are no longer being supported. Life at that stage provides enough clarity to build projections that feel realistic. That alone can bring a sense of calm, seeing your future on paper and realizing the numbers support the life you want to live.

The five-year mark before retirement is typically the most important. At that point, your checklist should include reviewing risk levels, income planning, and tax exposure. That’s the final period when adjustments to risk, taxes, and income planning can really shape the transition. Small Roth conversions may be appropriate now, especially during lower-income years or market downturns. That simply means converting a portion of your IRA to a Roth IRA in smaller amounts over time to avoid pushing yourself into a higher tax bracket. A gradual shift in stock-to-bond allocation can help reduce exposure to volatility. And most importantly, this is when the idea of retirement begins to move from an abstract concept to an actual lifestyle, one that needs to be funded, protected, and emotionally prepared for.

The five years before retirement are often the most crucial, because this is when peace of mind is built, or reinforced, through thoughtful, proactive planning. As retirement shifts from an abstract idea to an approaching lifestyle, it becomes essential to ensure that it will be funded, protected, and emotionally manageable. During this window, your checklist should include reviewing your risk levels, income plan, and tax exposure. This is the final stretch where adjustments in these areas can meaningfully shape your transition. One key step is gradually reallocating from stocks to bonds. Making this shift over time can help reduce volatility and create a steadier sense of security as you near retirement. This period can also be an opportunity to improve tax diversification. Smaller, incremental Roth conversions, especially in lower-income years or during market downturns, allow you to convert portions of a traditional IRA without pushing yourself into a higher tax bracket.

As advisors, we often ask our clients a simple but revealing question: “What does a Tuesday look like when you no longer go to work?” It’s easy to say, “I’ll travel” or “I’ll finally have time to relax.” But after the first few trips, how do you want to spend all the days in between? The more clearly you can answer, the more intentional your retirement strategy becomes.

Important Tax Changes for the Year Ahead

The One Big Beautiful Bill brought several meaningful updates, including a higher standard deduction. SALT (state and local tax) deduction rules now carry more weight for homeowners in high-tax states. And perhaps most notably, the federal estate tax exemption was raised to $15 million per person (or $30 million per married couple), which reshapes legacy planning for wealthier households.

But one of the most practical implications relates to charitable giving. If you’re already taking RMDs and plan to donate, sending money from a checking account may no longer be the most efficient route. Instead, a Qualified Charitable Distribution (QCD) from an IRA can satisfy part or all of the RMD and potentially reduce taxable income. In other words, the gift may have a greater impact with less tax drag, just by changing how it leaves the account.

The Real Danger: Not Hesitation but Delay

Most year-end planning stalls not because people are uncertain, but because they feel overwhelmed or assume that January will be a better time. The holidays get busy. Travel plans get in the way. Tax season seems close enough, so tasks quietly move down the list.

But procrastination often reduces access to options, and year-end planning is about maintaining options. When advisors have time, they can split a withdrawal across two tax years instead of one or reduce market exposure earlier when significant expenses are on the horizon. A simple bad-timing mistake can turn a $50,000 withdrawal into a costly tax event if the request comes too late or during a volatile market week.

This doesn’t mean planning needs to be stressful. At Merit, we make it remarkably simple: clients have access to a digital portal that consolidates all their financial accounts into a single dashboard. Our partnership with Wealth.com enables clients to create a will, power of attorney, and a healthcare directive in a single evening, and our partnership with Block Advisors provides professional tax support that saves hours of guesswork.

A Moment to Pause and Look Forward

Retirement planning isn’t just about getting the math right; it’s about creating the conditions for a life that feels steady and intentional. The final step on your year-end checklist is to pause long enough to make decisions before they make themselves. And having someone walk you through those choices can bring clarity, confidence, and momentum.

Ready to walk through your year-end retirement planning checklist? Contact Merit Financial Advisors today for a complimentary consultation and start the new year with clarity and confidence.