## Beginning of year investing checklist

09 Jan 2023

The beginning of a new year is a good time to contribute to tax-advantaged investment acounts, since these often have an annual contribution limit that you might have already exhausted for the prior year. Here’s my checklist. Would love to hear more about other things that you do as well

• Do the Backdoor Roth IRA: Contribute to traditional IRA and a day later transfer to Roth IRA account. Annual limit is $6,500 in 2023 • Buy I-bonds. Rates have been 6-9% over the last couple years due to high inflation. Annual limit is$10,000
• Max out HSA account. I like to fund the account lump-sum at the beginning of the year rather than via paycheck deductions. Annual limit is $3,850 if you have self-only coverage, or$7,750 for family coverage
• Tweak paycheck contributions for 401k. If you like to front-load 401k contributions at the beginning of year:
• First set the traditional 401k paycheck contribution to 75% (or the max that your plan allows). Also get all the employer matching. 2023 Annual limit of $22,500 for employee contribution • Then, set the after-tax 401k paycheck contribution to max, to fund the Mega Backdoor Roth if your employer provides it. Annual contribution limit is$32,250 for 2023 (at least in my plan)
• Alternately, set-and-forget these numbers such that the desired contribution is reached by the end of year
• Contribute to 529 account. There’s no limit for 529 contributions, but the gift tax exclusion limit for 2023 is \$17,000