Money moves to make before the year ends

With the new year a mere three months away, you may already be thinking about your 2016 resolutions.

A better plan? Focus on your current finances. By employing smart strategies now, you could see a reduction in your April tax burden, a boost in your retirement and college savings, and make a significant dent in any debt you might owe—starting off 2016 on the right financial footing.

—By Lucy Maher, special to CNBC.com
Posted 25 September 2015

Has it been a while since you've taken a close look at your investments? Due to changes in the market—notably its recent volatility—most investors find that over the course of the year, their allocations may no longer match their risk tolerance. Should you need to sell investments in non-tax-sheltered accounts at a loss, do so before December 31 to lower your tax bill. You can buy the stock back, but you'll have to wait 30 days in order to claim it for tax purposes.

However, there are other options. "If you own investments such as ETFs or mutual funds, you can sell the investment, take the loss and repurchase a similar investment owned by a different investment company," said Jeff Rose, CEO and founder of Alliance Wealth Managementand author of "Soldier of Finance."

Say, for example, you owned the XYZ high-yield bond fund and it's currently at a loss. "You could sell it and immediately purchase the ABC high-yield bond and not wait the 30 days to get back in," he explained.

The good news: If you contribute to a 401(k), you still have time to increase your savings rate before year-end. If you're under 50 years old, you can contribute up to $18,000, an increase of $500 over last year. And those 50 and older can contribute up to $24,000.

If you're a high earner, there's even more incentive to up your contributions this quarter. Social Security withholdings are capped at $118,500 for 2015, so any dollar you make above $118,500 is free of the Social Security tax. If you make more than that, that means you've gotten back about 6.2 percent you're used to seeing deducted from your paycheck. Why not opt to put some or all of it toward contributions instead?

Another option: Contribute to a Roth IRA. You can contribute $5,500 for the year, or $6,500 if you're 50 years old or more. (Adjusted gross income limits for Roth IRAs for 2015 are $131,001 for singles or $193,001 for couples.) That money grows tax-free—you won't owe taxes on it when you take distributions out in retirement, as long as it has been there for five years or more.

While you're at it, many employers also allow you to set contribution rate increases to your retirement plans ahead of time, so why not do that for 2016?

Don't be one of those people stuck with a surplus of cash in their Flexible Spending Account and no way of using it before December 31. Though employers may allow workers to carry over up to $500 of unused balances or offer a 2½-month grace period in the next year to spend that money, other folks will find themselves scrambling to use up their funds. If you're one of them, opt for the hundreds of over-the-counter goods that are eligible. These might include first-aid kits, sunscreen of 30 SPF or higher, diabetic testing kits, prenatal vitamins, contraceptives and hot and cold packs. If you have a lot of money left in your account, it's a good time to load up your medicine cabinet.

If medical expenses are on your radar, look into a health savings account, or HSA. These perform like a savings account by offsetting the cost of high-deductible health plans by allowing you to deposit pretax dollars or deduct your contributions. This money grows tax-free—similar to an IRA or 401(k).

Take this time also to examine your insurance policies too. "Another, less common item that people don't address is insurance—life, health, disability," said Rose. "I like to use the end of year as a reminder to make sure that we have the proper coverage, aren't over paying on any polices, and identify any areas where we might have some vulnerability."

Funding your child's college account not only supplies them with much-needed cash come matriculation time, it also acts as a tax break. That's because contributions grow tax-free, and depending on your state, individual and joint contributions are tax-deductible.

What's more, grandparents can combine their $14,000 annual gift limit up to five years in advance, meaning they can put $70,000 in a 529 account at once without incurring federal gift taxes, and that money will grow tax-free. (There's currently a $14,000 annual gift tax exclusion, so a grandparent can "gift" that amount annually without incurring the gift tax.)

A recent Fidelity study found those with 529 plans had saved an average of $34,900 for college compared with an average of $26,500 saved by families without a 529 plan. Assets in 529 plans reached a record level of $258.2 billion in June, a 5.6 percent year-over-year increase, according to the College Savings Plans Network, an association of the state-sponsored plans.

Read MoreGen Y parents plan to save more for kids' college

If you haven't already done so this year, get a copy of your credit reports, which are available free from each of the big three reporting agencies—Equifax, TransUnion and Experian—every 12 months. This is the time to make sure there are no errors that could hinder your ability to get a mortgage or another type of loan. If you're on the hunt for a new job or think you may be early next year, it's worth noting that many companies now look at credit reports as part of the hiring process. A quick review of your credit report also protects against identity theft.

See something fishy, like loans or credit cards that you never opened or items that don't show your account is in good standing after a settlement was satisfied? File a dispute with both the consumer credit reporting agency and the organization that supplied the faulty information.

Even the most organized folks neglect to update their employer benefits after they get married, divorced or have kids. Don't fall into this habit.

"One more thing that is super important is to do a beneficiary audit," said Rose. "Have you changed jobs and you have a new 401(k) or life insurance policy? Have you opened a new IRA or updated your will? If so, it's important to review all of your accounts where you have a beneficiary listed, including IRAs, 401(k)s and life insurance policies, and ensure you have the right loved ones listed."

We've all been there: You pack up two large duffel bags of stuff you no longer need, only to watch them collect dust as the minutia of daily life takes hold. Rather than say you'll handle it tomorrow, do it today—or at least before December 31. That's because if you want to reduce your 2015 tax liability, you must make donations that can be itemized before December 31.

The same holds true for monetary charitable donations. If you have any stock that has appreciated over the years and you want to sell that without incurring capital gains, you may think about donating it, thereby avoiding a tax bill and gaining the ability to deduct the appreciated amount. Of course, be sure to vet the charities you have in mind and double-check that your intended donations are indeed tax-deductible. And always get a receipt.

The Federal Reserve is widely expected to raise interest rates in the coming months. That means credit cards with variable rates will charge cardholders more in finance charges, and mortgage rates and interest on other loans may creep up.

So it's a smart idea to set aside extra cash toward paying down any high-rate credit card debt now. If you have a good credit score, look for zero percent balance-transfer offers sooner rather than later. As the Fed moves away from a zero percent interest rate, credit card issuers are likely to do the same. Tackle your highest-rate card balance first to help minimize interest charges and knock out the debt faster.