For most tech professionals, December isn’t a slowdown; it’s a sprint to wrap outstanding items, finalize reviews, and close out the year. But amid the chaos, it’s also one of the most critical windows to tighten up your financial life.
With equity compensation, high income, and complex employer benefits, your year-end checklist requires a more strategic approach. Let’s review the five essential tasks you need to tackle before December 31st to close out the year with clarity and confidence.
1. Max Out Your Tax-Advantaged Accounts
The end of the year is a final checkpoint to ensure you’re getting the most value out of tax-advantaged accounts:
- 401(k): Confirm that you’re on track to hit the 2025 employee contribution limit of $23,000 (or $30,500 if you’re 50 or older). Many tech employees also receive bonuses in Q4, which can unintentionally push them over or under their target—so check your contribution settings before those final paychecks process.
- Health Savings Account (HSA): If you’re enrolled in a high-deductible health plan, HSAs are one of the most tax-efficient tools available. The 2025 limits are $4,150 for individuals and $8,300 for families. HSAs reduce taxable income, grow tax-free, and offer tax-free withdrawals for medical expenses—triple tax benefits you shouldn’t leave on the table.
- Backdoor Roth IRA: If you’re pursuing a backdoor Roth strategy, ensure both your traditional IRA contribution and your Roth conversion are completed before year-end.
Action: Review your final pay stub or the HR portal now to ensure contributions will be made by December 31st.
2. Review Your RSU Tax Situation
Equity compensation can be a wildcard in a tech professional’s tax bill. Year-end is the perfect moment to ensure your RSU activity isn’t setting you up for an unfortunate surprise tax bill.
- Check RSU Withholding: RSUs are typically withheld at the flat 22% supplemental rate. If your RSUs vested throughout the year or your effective tax rate has changed, your real tax liability is higher.
- Use Tax-Loss Harvesting: If some of your vested shares or other taxable investments are underwater, selling at a loss can offset RSU gains. Many tech workers use December to review and refine their portfolios and minimize taxable gains.
- Evaluate Estimated Payments: If your tax projections show you’ve underpaid, you can remedy it with a Q4 payment. When reviewing your pay stub, check that the amount of income reported matches the number of vested shares multiplied by the share price on the vesting date.
- Preview 2026 Vesting: Look ahead to next year’s vesting schedule. If you expect significant gains early in the year, you may want to adjust withholding or plan sales in advance.
Next Step: Run a quick 2025 tax projection using professional software or a paycheck calculator to avoid a big tax bill later.
3. Strategic Charitable Giving
Charitable giving can be both meaningful and highly tax-efficient—especially for those with equity compensation. Here are a few strategies to keep in mind:
- Donor-Advised Funds (DAFs): Bundling multiple years of donations into a single contribution may help you maximize itemized deductions.
- Donate Appreciated Stock: You can avoid capital gains tax while still deducting the full fair market value.
- Keep Good Records: Documentation is required for all charitable contributions.
A Simple Win: Complete all charitable gifts by December 31st. Postmarks count, so even if you’re cutting it close, you can still reap the benefits of strategic charitable giving!
4. Use-It-or-Lose-It Benefits
Some employer benefits don’t roll over, and year-end is your last chance to capture their value. These include:
- Healthcare FSA: Spend any remaining balance in your FSA account before it disappears, unless your plan provides a grace period or small rollover.
- Dependent Care FSA: Make sure you’ve used the full $5,000 benefit and gathered receipts.
- ESPP Review: Look at where you are in your current purchase period and consider the tax treatment of your chosen holding strategy.
Don’t forget: Schedule outstanding appointments and order eligible supplies before December 31st so your benefits don’t go unused.
5. Review Essential Documents
A quick year-end review of your financial documents ensures that everything still aligns with your goals and life changes. Here are a few critical documents you’ll want to take a look at:
- Beneficiary Designations: Confirm beneficiaries on your retirement accounts, life insurance, and HSA. Remember that beneficiaries override your will.
- Estate Documents: Update your will, trust, and powers of attorney if you’ve had significant life changes such as marriage, having a child, or divorce.
- Insurance Coverage: Ensure life, disability, and umbrella policies continue to reflect your income and needs.
- Net Worth Snapshot: Updating your annual net worth statement helps track progress toward long-term goals.
To-Do: Set a recurring calendar reminder each December to review and update beneficiaries.
Close Out 2025 with Financial Intention
These year-end financial tasks take just a few hours but can save you thousands in taxes, reduce financial stress, and set you up for a smoother start to 2026. With thoughtful planning—especially around equity compensation—tech professionals can turn year-end housekeeping into an opportunity for real financial growth.
Ready to start the new year with clarity and confidence?
Our team at Woven Capital can help you create a year-end financial plan tailored to your compensation package and goals. Schedule a consultation today!