Retirement Planning Moves to Make Right Now

Want to get a jump on end-of-year financial moves before the mad dash of the holidays? With fewer than three months to go before you get sucked into full-blown holiday mode, there may be a great opportunity to boost your retirement savings.

1. Max Out Contributions

Just as autumn rolls around, many employees -- particularly among high-paid professionals -- find that they have more money in their paychecks. That's because you only pay the 6.2% FICA tax on the first $118,500 you earn for the year -- once you hit that threshold, your employer stops withholding the money.

Many people simply blow that extra cash on the holidays, but you may be able to capture that money as extra retirement savings. Check with HR to see if you are on track to max out your 401(k) contributions for the year. (The limit is $18,000 for 2016, or $24,000 if you are over age 50.) If not, most plans allow you to increase your contribution percentage for every pay period until year-end.

Even if you are still paying FICA taxes, think about whether you can squeeze to get an extra percentage point or two of retirement savings before Dec. 31. Small increases really do add up over decades of investing.

2. Put Your Side Gig to Work

According to McKinsey Global Institute, 68 million Americans -- or 27% of the population --engages in some kind of independent work. And for a bit more than half of those, the "gig" work supplements a primary job. If you have income as an independent contractor, you should investigate whether you can take advantage of other retirement savings options.

In addition to traditional and Roth IRAs and SEP-IRAs, there is an important and often overlooked vehicle that allows workers to dramatically reduce their tax bills and save for retirement. Solo or one-participant 401(k) plans cover a business owner with no employees. If you're planning to create one for 2016, you must establish it by Dec. 31, even though you have a few more months to make your contributions.

These plans have the same rules and requirements as any other 401(k) plan, but in the solo, you can stash away much more money for retirement. That's because the business owner wears two hats -- employee and employer -- and contributions can be made to the plan in both capacities. As an "employee," you can contribute 100% of your earned income up to that same $18,000/$24,000 annual contribution limit, as in a 401(k) -- but as an "employer," you can also put in up to 25% of compensation. The total contributions to your account, not counting catch-up contributions for those age 50 and over, cannot exceed $53,000 for 2016.

3. Give It Away Now

It's not quite retirement planning, but people usually include charitable gifts as part of their year-end financial to-do list. Just make sure that the tick-tock of Dec. 31 isn't pushing you into giving money away to organizations that may not be all that important to you, in the grand scheme of things.

Do, however, take this time to review the charitable contributions you made over the past year and consider whether you want to donate any more cash or highly appreciated securities.

And if you're worried about sticking your heirs with a large estate tax bill -- which falls into the category of nice problems to have -- remember that you can whittle down your estate by making annual gifts. The limit this year is $14,000 before you have to report it to the IRS, but again, remember you'll face a year-end deadline.