How to set yourself up for financial success in the New Year? The steps you take in December are critical to closing the year with confidence. Here’s how to end 2025 on a high note, so you can enjoy a financial fresh start come January first.
Set aside a few hours to review your spending for the year. If you can, print out credit card statements and use a highlighter to “bucket” spending categories, such as groceries, meals out, entertainment, utilities and so on. While a yearly spending review takes time, the payoffs are enormous. Understanding the specifics of what you’re purchasing, plus when spending is highest, will give you invaluable data when it comes to setting a budget for next year.
Many people set ambitious financial goals at the start of the year. December is the ideal time to come back to those goals and evaluate your progress. Did you hit your savings aims? Or pay down high-interest debt? Or open a retirement account? Most importantly—don’t get discouraged if some goals remain unmet. Consider what held you back (from impulse buys to accumulating debt) and how you can get closer next year. Ask for help if you need it with free financial counseling.
Depending on your age, financial goals and current budget, maxing out retirement contributions is a usually a good financial move for the end of the year. This could mean putting money into an Individual Retirement Account (IRA), or starting an IRA if you don’t yet have one. Also, check with your employer about matching contributions to a 401(k) or pension scheme. Employers will sometimes match funds you add to the scheme, which is a fantastic way to build your retirement savings faster.
If you’re one of the many people who autopay insurance bills, you might not be across premium increases, policy changes or other coverage details. Use the end of the year as an opportunity to revisit all your insurance policies (home, auto, renters, life insurance, etc.) to ensure you know what you’re paying and what you’re getting for that price. This is also a time to comparison shop and see if there’s a better deal elsewhere. Check out Harvard FCU’s insurance offerings here.
Sure, it’s traditional to wait until January to make your financial resolutions for the new year. But why not get a head start and develop some goals for next year, right now? Goals could include improving your credit score by a certain number of points, paying every credit card statement balance in full and on time, starting a retirement account. The benefit of setting financial resolutions early is that by the time January hits, you’ll already by ahead of the game.
December is one of the most popular shopping months of the year. To avoid accruing debt just when you’re ready for a fresh financial start, make it a priority to do holiday gifting differently this year. This might look like shopping second-hand or making gifts at home; going to the store with cash to stay on budget and limit impulse buys; or using a credit card that offers cash-back rewards. For more tips on budget holiday shopping, check out this blog.