Year-End Financial Checkup

As we enter November, most of 2026 is now in the rearview mirror. Goals we started earlier in the year may be nearing completion or might have gotten off track. No matter where your financial situation stands, now is the perfect time for a year-end financial checkup so you can meet your goals or course-correct. The most common goals you may have set earlier in the year, which we'll review now, include budgeting, managing debt, saving, and investing.

Creating and Sticking to a Budget

When we first meet with a new client, we review their spending patterns and whether they have a budget. Without a budget, you cannot easily accomplish other financial goals, so it is the first item to check off the list.

Perhaps you started budgeting earlier this year, but after several unexpected expenses, you fell off the wagon and stopped tracking your income and expenses as debt crept up in the background. The reality is that this is normal, and many people get overwhelmed or lose the capacity to stay on track with their budgeting plan due to an unexpected death, illness, or major expense. However, the most important thing now is to course correct.

The first step is to re-review your income, where your money is going, and create a cash flow analysis to see where things stand and what you can cut versus what is essential. Our introductory budgeting guide is a great place to start if you need help.

Managing Debt

If your budget is still on track, or you have figured out what you can cut, pay off, save, and invest for your future, the next step is to optimize any debt you have through consolidation.

While borrowing money is a tool to help us stay afloat, credit cards are often the most common option, but they carry high interest rates that slow payoff and often spread debt across multiple cards.

If you have multiple high-interest debts, primarily on credit cards, consolidating them with a personal loan through a credit union or bank could reduce your interest rate by nearly half and can help create a more reasonable payoff plan, freeing you to break the debt cycle.

For debts that aren't high-interest loans, such as student loans or mortgages, it never hurts to see whether interest rates have dropped since you took them out and refinance if a better rate is available. Doing so frees up cash and helps you better align your spending habits for a more optimized future.

Savings Goals: Emergency Funds, College, and Retirement

Once you have ensured you are on track with your budget and you know where any debts stand, saving for your present and future is the next goal to check in on.

For many people, unexpected expenses may have depleted their emergency fund or diverted their ability to save for a dependent's college or their own retirement.

If you depleted your emergency fund, now is the time to replenish it before the holidays and the new year begins, since health insurance deductibles often reset on January 1st, and health care expenses often derail our savings goals.

Also, if your emergency fund is in good shape but you had to divert money from your HSA, IRA, or 401(k), now is the time to restart contributions before the year ends to maximize your tax benefits.

Notably, while you can make HSA and IRA contributions for 2026 in early 2027 if you cannot make them by year-end, you must make 401(k) contributions by 12/31/2026.

Our previous blog post, Last Call for Year-End Tax Moves, is a great place to start for optimizing your tax-preferred savings accounts.

Investing for the Future

Now that we have discussed budgeting, debt, and savings goals and how to get them back on track, our final goal to review is investing for the future.

With the year coming to an end and most markets up since January 1st, now is the time to review whether your investments have drifted beyond your risk profile and whether you need to rebalance to stay on track with your financial plan. While risk is a spectrum and each investor's ability to tolerate fluctuations varies, it is essential to stay within your comfort-based volatility band. Our blog, The Spectrum of Risk, is a beginner's guide to risk-based investment management.

Furthermore, if your debt and savings goals are on track, now is a great time to invest extra cash for long-term goals, since it gives you a better chance to capture future gains. So, putting extra cash toward your financial goals by investing it in the market is another way to help you stay on track.

Closing Thoughts

Each year brings unexpected wins and setbacks, but how we respond to these changes determines whether we stay on track with our future goals.

By reviewing your current financial situation before year-end, you can help ensure you don't drift too far from your goals and put yourself in a better position to succeed.

If you have struggled to stay on track with your financial goals or are unsure where to start, we are here to help. At Lundeen Abrams Advisors, we serve the greater Minnetonka area and help our local community achieve their financial dreams by offering holistic financial and investment management services.

Please reach out to us today to schedule an appointment, we look forward to talking with you soon!