Happy New Year 2012

As 2010 comes to an end, there are a number of financial items that you must start to look at if you want to put yourself in position for a great 2011. Oftentimes, as we plan for the end of the year, we ignore important things we can do to make our financial life better. To make sure that doesn't happen to you, here are some action items that you should look into before the ball drops and the champagne corks pop.

First, it's important to pay attention to your IRA. Reduce your taxable income by maximizing your retirement contributions. The contribution limits for traditional and Roth IRAs remain at $5,000, with a catch-up contribution of an additional $1,000 for those 50 and older by the end of 2010. Therefore, you can contribute up to $6,000 to a Roth or traditional IRA if you're 50 and older.

With IRAs, it's also important to see if you need to withdraw money. Make sure you, or your older family members, take the required mandatory distribution (RMD) from IRA accounts. The government requires that people over the age of 70 1/2 take a yearly distribution of a set amount (if this distribution is not taken there are tax consequences).

At the end of the year, it is also important to review your portfolio and the positions you hold. See if you have any realized capital gains this year from the sale of stocks or mutual funds. When you've added your gains, check to see if there are any losses that can be carried forward from previous years to offset these gains. If there aren't, consider selling underperforming securities.

Ed Butowsky is the managing partner of Chapwood Investment Management and is an internationally recognized expert in the investment wealth management industry.

Ed Butowsky is an internationally recognized expert in the investment wealth management industry. Ed appears live on various new channels such as CNN, Fox News, and Fox Business just to name a few. He covers various topics from utility stocks to billion dollar ipos.