As the year draws to a close, it’s natural to think about what’s next. But before you dive into new resolutions, let’s take a step back and look at your 2024 finances. Reflecting on what worked (and what didn’t) helps you move forward with clarity and confidence. Here’s a simple guide to reviewing your finances so you can start 2025 refreshed and ready to go.

1. Celebrate Your Wins

Before you jump into what needs improving, take a moment to celebrate your financial wins. Did you manage to save more than expected? Finally pay off a credit card? Stick to a new budget? Acknowledging your achievements, no matter how small, gives you a sense of progress and keeps you motivated.

Make a list of all the positive changes you’ve made or financial goals you’ve met this year. Reflecting on what you’ve achieved will give you a boost of confidence as you prepare for your next steps.

2. Identify Areas for Improvement

Once you’ve celebrated, it’s time to take an honest look at where you could improve. Ask yourself questions like:

• • Were there any unexpected expenses that threw off your budget?
  • Did you struggle to stick to any specific financial goals?
  • Are there areas where you overspent?

This reflection isn’t about criticising yourself, it’s about understanding where things may have gone off track. Knowing where you struggled will help you set realistic goals for next year and find ways to tackle those challenges head-on.

3. Review Your Debt and Savings Process

Your debt and savings are two major pillars of financial health. Look at where you stand with each:

• • Debt: How much debt have you paid down? Did you reach any of your debt reduction targets?
  • Savings: How is your emergency fund? Are you on track with your retirement savings or other savings goals?

If you didn’t reach your targets, that’s okay. Use this information to adjust for next year. Maybe you’ll aim to contribute a bit more to your debt payments or bump up your savings rate. Small changes can have a big impact over time, so don’t feel pressured to overhaul everything at once.

4. Assess Your Spending Habits

Sometimes, our spending habits change without us even noticing. Take a look at your spending patterns over the past few months. Are there categories where you consistently overspend, like dining out, online shopping, or subscriptions?

This review can reveal where your budget could use a little tweaking. By identifying your personal spending triggers, you can plan ahead and avoid overspending in the future. It’s all about aligning your spending with your priorities and making sure your budget works for you, not the other way around. 

5. Update Your Financial Goals for 2025

Based on your review, set fresh goals for 2025. Remember to keep your goals specific and realistic. Here are a few examples to get you started:

• • Build an emergency fund with three months’ worth of expenses by the end of the year.
  • Pay off one credit card or reduce your debt by a specific amount.
  • Save for a family vacation or a big purchase, like a car or home improvement project.

Whatever goals you choose, make sure they’re meaningful to you. When your goals reflect what you truly value, you’re more likely to stay committed.

6. Adjust Your Budget to Reflect New Priorities

A new year often brings new priorities. After reflecting on your 2024 finances, update your budget to reflect any changes in your income, expenses, or financial goals. This might mean increasing your savings contributions, adjusting debt payments, or cutting back in certain areas to make room for new expenses.

Remember, your budget is a tool, it’s there to serve you. Make adjustments that help you live comfortably within your means while still working toward your goals.

Final Thoughts

Reflecting on your financial journey from the past year can give you valuable insights and help you start 2025 with confidence. By assessing where you are now, you’re giving yourself the power to make informed decisions and set realistic, meaningful goals. Here’s to wrapping up 2024 on a positive note and building a prosperous year ahead!

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