5 savvy year-end investing ideas

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As 2014 winds down, take time to review your investment strategies.

Here are five things you should think about when looking at your investments as 2014 draws to a close:

• Tax loss harvesting time. You have until Dec. 31 to offset gains and losses in your portfolio to minimize a potential tax bite this year. Remember, there is a difference between short-term gains and losses and long-term gains and losses. Also, be aware of the "wash sale" rule, which prohibits buying back the same security you sold to take a loss within 30 days of the sale.

• Portfolio rebalancing. If your asset allocation plan has become skewed because of out-sized gains or losses in certain areas, it's a good idea to rebalance. If you can work your rebalancing in with your tax loss harvesting, fine. Otherwise, it may be savvy to wait until January to rebalance to push a potential tax bite into next year.

• Beware of mutual fund taxable distributions. By law, mutual funds must distribute 95 percent of their earnings each year. They usually declare and distribute these earnings in December. If you buy a mutual fund in December right before the distribution, you could end up with an unwelcome tax bill come next January or February when the mutual fund sends out their 1099s.

• Flexible Spending Accounts. FSA rules say "use it or lose it." If you haven't spent the funds in your FSA, it may be a savvy idea to spend the unused funds this month or you will forfeit any remaining balance. Also, check with your plan administrator to see if there have been any recent changes.

• Charitable giving. Now is the time to think about your charitable giving, not on Dec. 31. Gifts are deductible only in the year they are made. Gifts by credit card are deductible if made in the current year, even if the credit card bill is paid in 2015. Gifts of appreciated assets could save on capital gains tax, as well as offer an income tax deduction up to certain limits.

For more details on employing these tips please seek advice from your accountant or financial advisor.

Dennis E. Michels is senior vice president of investments at Moors & Cabot Investments in Winter Park. He can be reached at (407) 691-5357 or dmichels@moorscabot.com.