The new year often feels like a fresh start—a clean slate for setting goals, building new habits, and turning aspirations into achievements. While many people focus on resolutions related to physical health, productivity, or personal development, one of the most important areas to consider is your financial health. After all, financial freedom can help you achieve a sense of security, reduce stress, and enable you to live the life you envision.
Just like any goal, setting financial resolutions requires thoughtfulness and a strategic approach. It’s easy to get overwhelmed by the sheer number of things you could do—save more, spend less, invest better, pay off debt—but where do you start? Here’s how to turn your financial dreams into actionable goals that you can actually keep.
1. Reflect on Your Financial Position
Before jumping into setting new goals, take a step back and assess where you currently stand. Creating a net worth statement allows you to organize your assets and liabilities and understand where you are currently.
Actionable Step:
Create a simple financial snapshot for yourself:
- Debt (credit cards, student loans, mortgage, etc.)
- Savings (emergency fund, retirement savings, etc.)
- Investments (stocks, bonds, real estate, etc.)
- Insurance
This will give you a baseline from which you can start to build your plan.
2. Assess your Cash Flow
Once you’ve assessed your net worth statement, it is time to evaluate your cash flow. What income is coming in and from what sources? What monthly and annual expenses do you have today and throughout the coming year? Are you withholding taxes or sending in estimated payments?
- Review your expected income and the sources it is derived from
- Create a budget and track your spending. You don’t need a perfect budget out of the gate, the key is to create a spending plan that aligns with your goals.
- If there is a surplus of income compared to expenses, review plans for excess savings. Can you improve the tax efficiency of these savings?
- If there is a gap in expenses compared to income, was this a surprise? If it is by design, how are you funding that gap?
3. Review Investment Allocation and holdings
Now that you have a clear understanding of your net worth and cash flow, it is time to make sure your investments are still aligned with your 2025 goals.
- What risk is your portfolio currently exposed to? Is this risk still a level you are comfortable with today? Are the holdings from the last administration and a rising market still the best picks for the new administration and the current economic policies? Review mix of stocks, bonds and cash. Review sector exposure. Review concentration to individual companies.
- What are you paying for your investments, and for that cost, how are they faring compared to the benchmark? Review expense ratios and management fees.
- How much in taxes are you paying on your investment portfolio? It is not what you make, it is what you keep. Review statements to see the 2024 capital gains distributions, short/long term capital gains, and dividend/interest income.
4. Review Estate Documents
One of the most common pitfalls in a financial plan is not planning for heirs. The large majority of individuals do not have an estate plan in place. If something happens to you, do you know how your assets will transfer. It is important to review how your assets are titled, and the beneficiary designations on each account. Do you have a will? If you have trust documents, are the assets titled in a way where the assets flow through the trust? Have any new family members been born since the last time the beneficiaries or estate plan was updated? The new year is a perfect time to make sure if a surprise occurs, there is a contingency plan in place for your loved ones.
Set a reminder once a month to review your spending and savings goals. This simple step keeps you in the loop and prevents you from getting sidetracked.
Final Thoughts: Keep Going, No Matter What
Achieving your financial goals isn’t a race—it’s a marathon. If you need help creating and organizing your family’s financial plan, Decima Wealth Consulting can help.
By making your financial resolutions specific, measurable, and manageable, you can set yourself up for long-term success. So, as you dive into this new year, take the time to create a financial plan that empowers you to reach your goals and secure your future. Happy New Year—and happy saving!
