With the new year ringing in and many economic shifts anticipated for Americans in 2025, a lot of our clients are looking for a way to ensure their finances are in order. Market trends, inflation, and new financial challenges require planning, which is why we've put together the following checklist.
The following information is designed to help you stay resilient, prepared, and equipped to build a long-term financial strategy.
Our checklist gives you actionable steps to improve your financial situation, allows you to review goals, track spending, and reduce debt, plus encourage saving for emergencies and planning for the future.
#1 Review Your Financial Goals
If you haven't already, now is a good time to determine what your short- and long-term financial goals are. Start by reviewing savings, investments, and debt to see how close you are to achieving them. Assess your progress toward financial milestones and identify goals that need to be adjusted.
If you have any major changes coming up this year, such as a new job, addition to the family, or home purchase, adjust your financial goals accordingly.
After reviewing what you want to accomplish this year from a financial standpoint, consider adjusting goals to meet your circumstances. Keep goals specific and measurable. For example, set a monthly savings goal and determine the percentage of debt you want to pay off.
#2 Assess Income & Expenses
Do you have a monthly budget you follow? If not, now is the time to create one. Your budget should include total household income and a breakdown of expenses (preferably categorized). Then ensure your budget accounts for your goals–savings, debt payments, and discretionary spending.
Be sure to keep track of recurring expenses, subscriptions, and automatic payments. Do you have any subscriptions you no longer use? If so, consider canceling them to reduce unnecessary expenses.
The last consideration is any unnecessary spending that can be cut back or eliminated altogether. This includes impulse buying, non-essential purchases, or cost-saving alternatives. For example:
- Cook at home and eat out less
- Save on gas by carpooling or using public transportation frequently
- Streaming bundles versus individual subscriptions
- DIY home repairs as opposed to hiring a contractor
- Buy used instead of new
#3 Build & Maintain Emergency Fund
Having access to an emergency fund can literally be a life-saver. We recommend having at least three months of living expenses saved. You never know when this financial cushion will come in handy. Common emergencies include loss of job, medical expenses, and veterinary bills.
Having funds saved for an emergency avoids having to take out a high-interest loan and can help keep financial stress low. To say the least, emergency funds offer peace of mind.
If you don't already have an emergency fund, get the ball rolling by starting small. You can set up automatic transfers with each paycheck; even 10 to 20 percent can make a big difference. If you're anticipating a work bonus, put it into your emergency fund–avoid the temptation to buy that new big-screen TV.
When setting money aside for emergencies, consider a high-yield savings account for better interest rates. Avoid volatile assets, like stocks and digital currency, and any accounts that are hard to get quick access to. You may even want to consider diversification in the form of a primary bank and online savings account, again, for ease of access.
#4 Manage & Reduce Debt
You may already know this, but it's worth repeating, pay off your debt with the highest interest rates first. Interest payments don't pay down the principle, so instead of paying more than the monthly minimum on multiple accounts, pay the minimum on low-interest accounts and put as much as you can towards the largest account with the highest interest rate. When paid down, move on to the next highest interest account, and so on.
If you have accounts with small amounts of debt, you may also consider taking care of these sooner than later. This can help you build momentum and motivate you to continue paying down your larger loans.
If paying off debt is of a great deal of importance to you and your financial outlook, avoid taking on new debt at all costs. In other words, pay in cash equivalents versus using a credit card. Utilize your emergency fund, assuming you have one, so you don't have to take on another line of credit.
#5 Consider Investment & Retirement Accounts
If you have investment or retirement accounts, now is a good time to review them. Things to look for include investment returns over the past year. Are you diversified? If not, consider a mix of stocks, bonds, or other investments in an effort to balance risk. If some of your investments are too large or are underperforming, rebalance.
Maximize your 401(k) contribution in order to receive your employer's full match. If you have an IRA, increase your contributions–on an annual basis, if you've received a raise, or if you've maxed out your 401(k) contribution.
Adjust contributions as the market shifts and personal goals evolve. Stay informed about economic trends, new laws, and other market conditions. Market fluctuations happen, so try to avoid emotional decision-making and try to stick to your long-term plan.
#6 Check Insurance Coverage
This time of year is a good opportunity to review insurance coverage. You want to make sure you have sufficient health, auto, life, and home insurance. Read the fine print on your policies and check the coverage limits to confirm they meet your needs.
You may also consider updating beneficiaries, especially if you've experienced (or plan on experiencing) a major life change like marriage or having a child. Adjust those policy details too to make sure your new circumstances or dependents are covered.
Is there any other coverage you may need in the future? You may consider adding disability insurance to protect your income in case of injury or illness.
#7 Conduct Tax Planning
2025 promises some interesting tax changes, including standard deduction increases, income tax bracket adjustments, estate and gift tax exemptions, and retirement account contribution limits, to name a few.
You may want to speak with a financial advisor or tax accountant in order to fully understand your tax obligations and potential refunds. You should estimate taxes owed or what your refund may be using last year's filings. Account for changes too, such as new income sources, investments, or dependents.
Maximize your contributions to your 401(k), IRA, or HSA in an effort to reduce your tax liability. Review limits in order to take full advantage of pre-tax savings opportunities.
Keep good records for tax preparation, including W-2s, 1099s, and deduction records. Organize your receipts, track charitable deductions, and make note of business costs.
Have a Professional Advisor Help With Your Financial Health Check
At Benefit & Financial Strategies, we know financial planning is about more than just crunching numbers—it’s about building trust and supporting you through every step of your journey. Whether it’s refining your goals, managing debt, or growing your savings, our team is here to provide expert, personalized guidance that fits your unique needs.
We’re here to help you stay ahead with proactive planning, regular check-ins, and strategies that evolve with your unique goals and changing needs. Our advisors specialize in identifying opportunities and helping you stay on track, so you can feel confident about your financial future every step of the way.
Let’s make 2025 your year to thrive. Schedule a free consultation today and see how personalized financial guidance can help you reach your goals and build the future you deserve.