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Financial Tips for January

Writer's picture: BFGWM TeamBFGWM Team
Jan 13 min read

This is the perfect time to take control of your finances. The start of 2025 presents an opportunity to reflect on the past year’s financial progress, set realistic and achievable goals, and create a budget that aligns with your long-term objectives. By following these three essential steps, you can ensure a strong financial foundation for the year ahead.


1. Review Last Year’s Financial Progress


Before planning ahead, it’s crucial to assess how you managed your finances in 2024. Taking stock of your income, expenses, savings, investments, and debt can provide valuable insights into what worked well and what needs improvement.


Key Areas to Review:


Income & Expenses: Compare your earnings and spending patterns. Did you stick to your budget, or were there areas of overspending?


Savings & Investments: Review your savings accounts, emergency fund, and investment portfolio performance. Did you meet your savings targets?


Debt Management: Assess any outstanding debt, including credit cards, student loans, and mortgages. Have you made progress in reducing debt, or do you need a new strategy?


Credit Score: Check your credit report for any discrepancies and monitor your score. A higher score can help secure better loan and credit card rates.

Taking time to analyze these areas will give you a clear picture of your financial health and guide your next steps for 2025.


2. Set SMART Financial Goals for 2025


Once you’ve reviewed your financial progress, it’s time to set new goals. As mentioned in our post in December, using the SMART framework—Specific, Measurable, Achievable, Relevant, and Time-bound—ensures your goals are clear and attainable.


Examples of SMART Financial Goals:


  • Increase Savings: Save $6,000 by the end of 2025 by setting aside $500 per month.

  • Pay Down Debt: Reduce credit card debt by $3,000 by making extra monthly payments of $250.

  • Boost Retirement Contributions: Increase 401(k) contributions from 5% to 10% of your salary by mid-year.

  • Improve Credit Score: Raise credit score from 680 to 720 by paying bills on time and reducing credit utilization.

  • Plan for Major Expenses: Save $10,000 for a home down payment within 12 months.

Write down your goals and track them monthly to stay accountable. Regular check-ins will help keep you motivated and allow for adjustments as needed.


3. Create or Adjust Your Budget for the New Year


With clear goals in mind, the next step is to structure your budget to support them. A well-planned budget helps manage expenses, maximize savings, and prevent financial stress.


Steps to Build an Effective Budget:


  1. Calculate Your Income: Include your salary, side hustles, passive income, and any expected bonuses.


  2. List Fixed & Variable Expenses:

    • Fixed: Rent/mortgage, insurance, car payments, student loans.

    • Variable: Groceries, entertainment, dining out, shopping.


  3. Allocate Savings & Debt Repayment: Follow the 50/30/20 rule—50% for needs, 30% for wants, and 20% for savings/debt.


  4. Cut Unnecessary Costs: Identify areas to reduce spending, such as unused subscriptions or dining out less.


  5. Automate Payments: Set up automatic transfers for savings and bills to avoid missed payments.


  6. Adjust Monthly: Review and tweak your budget as needed to accommodate financial changes.


By proactively managing your budget, you can ensure financial stability and stay on track with your 2025 goals.


January is an excellent time to reset your financial habits and plan for success. By reviewing last year’s financial progress, setting SMART goals, and creating a structured budget, you set yourself up for a prosperous and stress-free 2025. The key is consistency—small, disciplined actions taken now can lead to significant financial achievements by the end of the year.


Pro Tip: Schedule monthly financial check-ins to track progress and make adjustments as needed. Stay committed, and your financial future will thank you!


Our clients are able to track expenses and see everything in one place with their wealth management portal.


If you are ready to take your investments to the next level, contact us and Get Started today!









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