Charlie MarlowThe beginning of the year is the perfect time to review your financial plan, make necessary changes, and reap the benefits for the remainder of the year. Take these six steps to put some cold cash in your pocket this year!
Review Your Budget – The first of the year with pay and tax changes effective 1 January, this is the perfect time to review your budget or spending plan. You can evaluate how you spent your money last year and make a plan to make changes that will help you succeed financially in 2025. Don’t have a budget? Now’s the perfect time to start. A budget is just a list of your income and your spending plan. It does not require an app or fancy spreadsheet. A pencil and notebook work just as well, especially if you’re new at budgeting.
Plan for Christmas 2025 – The Christmas rush is over. The tree is down, the ornaments are back in the storage shed, and some toys are broken or forgotten already. Make Christmas 2025 easier by creating your Christmas budget now. Make a list of everyone you want to buy for and set a spending amount for each person. Add some for new decorations, office parties, secret Santa gifts, and wrapping paper, divide by 12 (or number of paydays until Christmas), and start setting that amount aside now. The money will be there when the shopping season starts and you’ll have money set aside if you find that perfect gift in July.
Create a Debt Elimination Strategy – Debt payments reduce the amount of money available to spend and save. Make a plan to reduce and pay off that debt by using the Debt Snowball Method where you focus on paying off your smallest debts first and then pay them off one by one until they are all paid off. The Debt Avalanche Method of paying off the debts with the highest interest rates will save you the most in interest. Use the PowerPay: Debt Reduction Tool to see how quickly you can be out of debt.
Check Your Tax Withholding – Did you get a big tax refund last year? Did you owe taxes when you filed? Changing your W4 with your employer can help you “right size” your withholding so you pay the right amount of taxes throughout the year. Use the Tax Withholding Estimator | Internal Revenue Service to help you determine the withholding right for you.
Boost Your Savings – Interest rates at your local bank or credit union are next to nothing and moving your savings to a high-yield savings account (HYSA) can boost your savings. According to DepositAccounts.com, the average bank account earns 0.5% APY but the top HYSAs pay seven to eight times that! HYSAs are easy to open and make transfers.
Check Your Credit Report – Review all three major reports and report any discrepancies. You can order all three reports from Experian, TransUnion, and Equifax at Annual Credit Report.com for free once per year!
Taking these few steps early in the year can set you up for financial success in 2025. Need more help? See your installations Family Support Center or financial counselor.
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