Sponsored content by Guillaume Decalf from www.ouifinancial.com. First of all, each situation is different and the financial points can differ according to your personal situation. This article was written for informational purposes only and the opinions mentioned here do not constitute financial advice.
With a few weeks left until the end of the year, now is a good time to take stock of your financial situation and verify that you have done everything right before December 31st.
Saving taxes is done during the year, NOT at tax time when it is usually too late.
1. Check that you are maximizing your 401k
If you plan to stay in the US for several more years, the 401k should be the cornerstone of your assets whether your company matches or not and even if you decide to return to France one day. There are still two months left to increase your contributions to the maximum of $ 19,500. If you have an “after-tax 401k” option (I’m not talking about the Roth here which is different) you can use that too.
2. Rebalance your accounts
Financial markets have had their ups and downs this year. Technology funds and stocks have risen sharply, now is probably a good time to reduce your positions to buy other funds or stocks.
3. Close or decrease your accounts in France
If you can, try to keep less than $ 10,000 in France (watch out for the exchange rate) so you don’t have to make a declaration here in the US in 2023 (it’s too late for 2022). If your money is sleeping in France and is not earning anything, now is also a good time to transfer it to the US where it can earn you more.
4. Make sure you have an emergency fund
It is important to have an emergency fund to cover over 6 months’ expenses. Unfortunately, no job lasts forever even if you work in tech. Better be safe than sorry :-). Even though savings accounts aren’t earning you that much now (0.5%), it’s important that all your money isn’t invested because if something happens, you don’t want to have to sell your investments at the worst possible time – when the markets are down.
5. Make sure your cash works for you
Beyond the emergency fund, the cash lying dormant in your savings accounts must work for you and earn you something. It does not mean putting everything on the financial markets in equities. Build a portfolio that matches your goals and time frame. The shorter your investment horizon, the more conservative the investment should be. https://ouifinancial.com/comment-investir-de-10000-a-10000000-en-2021
Bonus if you are self-employed (1099) …
It is advantageous to open a 401k solo before December 31st which will allow you to put:
- up to $ 19,500 before tax or after tax for that year as an employee,
- up to $ 38,500 after tax as an employee OR before tax as an employer … beware, there are subtleties, consult a professional.
Guillaume Decalf from www.ouifinancial.com – info@ouifinancial.com
After a 15-year career in the technology sector, nine of which in the United States, Guillaume changed careers by obtaining his license as a financial advisor and creating Oui Financial, a company specializing in financial planning and investments for French and Franco-American families in the United States. He is based in San Francisco, California, but serves clients all over the United States.
MerciSF is not responsible for the material contained in this article.
