Review These 4 Financial Tips Before December 31, 2025

Review These 4 Financial Tips Before December 31, 2025

As we wrap up 2025, many of us start thinking about the habits we want to refine and the goals we want to set for the new year. One area that deserves intentional attention—yet often gets overlooked—is your financial life.

Here are four smart year-end check-ins to complete before December 31st.

1. Review Your Spending Plan

• Look over your 2025 expenses. Are there new recurring costs that should be added? Any unused subscriptions or services that can be canceled?

• Identify areas where spending could be reduced or redirected to better support your 2026 financial goals.

• If you’re not currently using a budgeting system, here’s a great place to start:

  3 Alternatives to the Mint Budgeting App

• Consider using a budgeting or cash-flow app to simplify tracking the flow of money throughout the year.

2. Strengthen Your Emergency Fund

• Aim for 3–6 months of essential expenses saved in a high-yield savings account.

• Reevaluate your target amount based on life changes in 2025—job transitions, higher expenses, more dependents, or fewer earners.

• If your emergency fund is below your target, set a plan for steady monthly contributions in 2026 to rebuild your reserves.

3. Check In on Your Investments

2025 Retirement Contribution Limits

• 401(k)/403(b)/TSP employee deferrals: $23,500
• IRA (Traditional or Roth): $7,000
• Catch-up contributions (age 50+):
  • $7,500 for workplace plans

  • $1,000 for Traditional and Roth IRAs

• Special catch-up for ages 60–63: $11,250 (if your employer plan allows it)

Year-End Investment Actions

• If you aren’t maxing out your accounts, consider increasing contributions by 1% for 2026—small increases compound significantly over time.

• Review your portfolio allocation. Market swings throughout the year shift your mix of stocks, bonds, and cash.

  A year-end rebalance helps realign your investments with your risk tolerance and long-term goals.

• Not sure whether your portfolio is positioned correctly? Reach out to our team—we’re happy to help.

4. Review Your Required Minimum Distributions (RMDs)

If you are age 73 or older in 2025, or if 2025 is your first RMD year, this is a key item to address before December 31st.

What to know:

• If you turned 73 in 2024, your 2025 RMD must be taken by December 31, 2025.

• If you turn 73 in 2025, this is your first RMD year:

  • You may take your RMD anytime in 2025 or delay it until April 1, 2026.

  • But delaying means taking two RMDs in 2026, which may increase your taxable income.

• Confirm that all RMDs are withdrawn from the correct retirement accounts (IRAs, 401(k)s, 403(b)s, etc.).

• The penalty for missed RMDs is 25% of the amount not withdrawn (reduced to 10% if corrected promptly).

If you need help calculating or coordinating your RMDs, our team is here to walk you through the process.

Additional Resources to Support Your 2025 Wrap-Up

• 5 Year-End Tax Moves to Make Now (Anna Sergunina)

• 5 Ways to Get Organized in the New Year (Cynthia Flannigan)

• One Financial Habit to Change (Cynthia Flannigan)