Michigan Mid-Year Financial Checklist: 7 Things to Review Before December

July is my favorite time of year to have planning conversations with clients. Not because anything dramatic has usually happened — but because there’s still time to do something about it.
Six months left in the year is actually a meaningful window. Tax decisions made now can reduce your bill in April. Retirement contributions adjusted now compound through year-end. Insurance and estate planning issues caught now don’t become crises later.
Here are the seven things I review with Michigan clients every summer — and what I’m looking for in each one.

Your Mid-Year Financial Checklist

1. Review Your Michigan Pension and Retirement Income Tax Exposure Michigan fully phased out pension income tax in 2026 — but the $67,610 single / $135,220 joint exemption limit means some retirees still have taxable retirement income above the threshold. Now is the time to model your full-year income picture and see if there are adjustments to make before December.

2. Check Your Roth Conversion Opportunity July through October is often the best window to evaluate a Roth conversion for the year. Your actual income is clearer than it was in January, and you still have time to act before year-end. For Michigan clients, Roth distributions don’t count toward the $67,610/$135,220 pension exemption limit — making Roth assets especially valuable in later retirement year

3. Tax-Loss Harvesting — What’s Sitting at a Loss? Mid-year market movement often creates harvesting opportunities that didn’t exist in January. Review your taxable accounts for positions sitting at a loss that could be sold to offset gains elsewhere. Pair this with a review of your overall asset allocation — drift from target weights is common after six months of market movement.

4. Beneficiary Designations — When Did You Last Check? Beneficiary designations on retirement accounts, life insurance, and annuities override your will. A marriage, divorce, death, or birth in your family this year means your designations may no longer reflect your wishes. This takes 20 minutes and can prevent significant problems for your family.

5. Insurance Coverage Review Life, disability, and long-term care insurance needs change as your financial situation evolves. A mid-year review asks: does your life insurance still reflect your income and family obligations? Is your disability coverage adequate if you couldn’t work for six months? Has a health change made long-term care coverage more or less urgent?

6. Estate Planning Documents — Are They Current? Powers of attorney, healthcare directives, trusts, and wills need to reflect your current wishes and family situation. If you’ve had a major life change this year — marriage, divorce, a new child or grandchild, a business event, or a significant change in assets — your estate documents deserve a review before year-end.

7. Retirement Contributions — Are You on Track to Maximize? For 2026, the 401(k) contribution limit is $24,500 ($32,500 if you2019re 50 or older; $35,750 if you2019re ages 60201363 under the SECURE 2.0 super catch-up). IRA limits are $7,500 ($8,600 if 50+). If you2019re not on pace to hit your targets, July is when to adjust 2014 not December when it2019s too late to spread contributions across remaining paychecks.

A Deeper Look at Each Item

1. Michigan Pension and Retirement Income Tax

Michigan’s 2026 pension exemption is a meaningful benefit — but the combined limit on pension and pre-tax IRA distributions means higher-income retirees still have taxable retirement income above the threshold. If your total qualifying retirement income exceeds $67,610 (single) or $135,220 (joint), the excess is subject to Michigan income tax.
Mid-year is the right time to model your full 2026 income picture and ask: are there adjustments to make? Could you shift some withdrawals to Roth accounts? Is there a Roth conversion opportunity that reduces next year’s exposure? For more on how Michigan’s 2026 pension rules work, see our post on Michigan pension income tax in 2026.

2. Roth Conversion Window

The Roth conversion decision is one of the highest-value planning moves available to Michigan retirees — and the summer window is often the best time to evaluate it. By July, your income picture for the year is clear enough to model a conversion accurately, and you still have five months to act.A Michigan-specific advantage worth flagging: if you’re age 59.5 or older, your Roth conversion may qualify for Michigan’s $69,896/$139,792 IRA exemption — meaning the state tax cost of converting is reduced or eliminated up to the exemption limit. And once those dollars are in Roth, future distributions don’t count toward the exemption limit at all. That double benefit makes Roth conversions especially powerful for Michigan retirees.

Key questions to ask:

• Is your taxable income lower this year than it will be when RMDs kick in?
• Do you have room in your current tax bracket to convert without pushing into a higher one?
• Do you have cash outside your retirement accounts to pay the conversion tax?
• Would a converted dollar eventually come back as a Roth distribution — completely untaxed in Michigan?

3. Tax-Loss Harvesting

Markets move. Positions that looked like solid long-term holds in January may be sitting at a loss in July. Tax-loss harvesting — selling a position at a loss to offset realized gains elsewhere in your portfolio — is one of the few legal ways to reduce your current-year tax bill without changing your overall investment strategy.
The key rules: the loss must be realized (sold), and you must wait 30 days before buying back the same or substantially identical position (the wash-sale rule). Our tax planning services coordinate harvesting decisions with your overall investment strategy year-round.

4. Beneficiary Designations

This is the item that causes the most preventable family financial problems I’ve seen in my career. A beneficiary designation on a 401(k), IRA, or life insurance policy is a legal document — it overrides whatever your will says. An ex-spouse still listed as beneficiary on a retirement account from 20 years ago will inherit that account regardless of what your will specifies.

Beneficiary designations override your will. Review them every time your family situation changes.

Take 20 minutes this month and verify every account: 401(k), IRA, Roth IRA, life insurance, annuities, and any payable-on-death bank accounts. Make sure both primary and contingent beneficiaries are named and current.

5. Insurance Coverage Review

Insurance needs shift as your financial life evolves. A mid-year review covers three questions:

• Life insurance: Does your current coverage reflect your income, your mortgage balance, and your family’s needs if you weren’t here? Term policies taken out years ago may be underfunded — or you may be overpaying for coverage you no longer need.
• Disability insurance: If you couldn’t work for six months, how long could your household sustain itself? Most people underestimate how likely a disability claim is during their working years.
• Long-term care insurance: The window to get coverage at a reasonable premium is typically your 50s. Waiting until you’re 65 significantly increases the cost — and health changes can make you uninsurable.

6. Estate Planning Documents

Estate planning isn’t a one-time event. Documents need to reflect your current family situation, your current assets, and your current wishes. The most common triggers for a review:

• A marriage, divorce, or separation in your family
• A new child or grandchild
• The death of a named executor, trustee, or beneficiary
• A significant change in your assets — a business sale, inheritance, or major investment gain or loss
• A move to a different state — estate laws vary and your documents may need to be updated

Our estate planning coordination services work alongside your estate attorney to keep your financial plan and estate documents aligned. If you haven’t reviewed yours in the last two to three years, now is the time.

7. Retirement Contribution Limits

The 2026 contribution limits:

• 401(k) / 403(b): $24,500 standard; $32,500 if you’re 50 or older; $35,750 if you’re ages 60–63 (SECURE 2.0 super catch-up)
• IRA / Roth IRA: $7,500 standard; $8,600 if you’re 50 or older
• SEP-IRA (self-employed): Up to 25% of compensation, maximum $72,000
• SIMPLE IRA: $17,000 standard; $21,000 if you’re 50 or older
• HSA: $4,300 individual / $8,550 family (if you have a high-deductible health plan)

If you’re not on pace to max your contributions, a mid-year adjustment to your paycheck deferrals spreads the catch-up across six remaining paychecks — which is much easier than trying to make a large lump-sum contribution in December.

July is the last comfortable month to make mid-year adjustments. By October, there’s not much runway left.

The Michigan-Specific Items on This List

Most of this checklist applies to anyone in the country. But a few items are especially important for Michigan families:

• Pension income tax modeling — unique to Michigan’s 2026 exemption rules
• Roth conversions — Michigan’s full exemption for Roth distributions makes this more valuable here than in many other states
• Automotive industry clients — mid-year is a good time to review deferred compensation distribution schedules and pension election decisions if retirement is within the next 3–5 years

If you’re a Michigan family working through any of these items, a fiduciary financial advisor in Auburn Hills who understands Michigan’s specific tax rules can make sure you’re not leaving money on the table before December.

A Real Mid-Year Review: What We Found for Ron and April

I recently completed a mid-year check-up with clients Ron and April, focused on their 2026 tax planning and their upcoming retirement. Using our Holistiplan tax analysis software, we found something that surprised them:
They had overpaid their 2025 taxes and were owed a ~$3,500 refund. But they had also been charged interest and penalties by the IRS on the same return.
That sounds contradictory — but it’s a real and surprisingly common situation. You can overpay taxes overall and still owe a penalty if one specific quarter’s income was significantly higher than the others. The IRS doesn’t just look at your annual total — it looks at each quarterly estimated payment relative to the income earned in that quarter.
Ron and April had done exactly what their CPA guided them to do. They made predetermined quarterly estimated payments on schedule. But their second quarter income was higher than average — and the IRS penalized them for underpaying in that specific quarter, even though they overpaid across the full year.
For 2026, we are implementing one of the IRS Safe Harbor methods to prevent this from happening again:
If your Adjusted Gross Income is over $150,000: Pay at least 110% of your prior year’s total tax liability in quarterly estimated payments. As long as you hit that threshold, the IRS cannot penalize you for underpayment in any individual quarter — regardless of how your income is distributed across the year.
If your AGI is under $150,000: The safe harbor threshold is 100% of your prior year’s tax liability.

This is the kind of issue that doesn’t show up if you’re only looking at your return once a year in April. A mid-year review — especially for clients with variable income, retirement distributions, or business income — catches it while there’s still time to adjust.
— Andrew Charbonneau, CFP®

You can overpay your taxes overall and still owe a penalty. A mid-year review with the right tools catches this before it becomes an April surprise.

Want a Mid-Year Financial Review With a Michigan Fiduciary?

Fiduciary • Independent • Based in Auburn Hills • Serving Oakland County

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