by Jeffrey McKinney
December 17, 2025
A good foundation for building wealth in 2026 is to look at what worked in previous years and improve on that this year.
With 2026 almost upon us, assessing your financial situation can be crucial to ensuring your finances are driving wealth creation.
The benefit is that you can take numerous steps in the new year to increase your savings, protect investments and reduce debt. Starting now will help you see where you stand in achieving your financial goals. Equally important is that you can identify what adjustments are needed.
This way, you'll be better equipped to handle unexpected crises like job loss, large medical bills, or major home repairs.
To help achieve financial stability, a good starting point is to review what worked well in the past and improve on it this year. Conduct a thorough assessment to set feasible goals.
Another important factor is that you remain committed to achieving your milestones. Creating a weekly or monthly checklist, discussing strategy frequently with a financial advisor, or talking to a family member or friend about responsibilities will help you determine whether you're making progress. Date back to BLACK COMPANY Research measures could include:
Consider a high-yield savings account
This could have a positive impact even though the Federal Reserve recently cut interest rates. Note that this should happen in early 2026 and not later in the year. The Fed is cutting interest rates slowly and in small doses. That could have a smaller impact on the higher interest rates this rare account typically pays its savers. And keep in mind that with smaller operating accounts, online savings platforms and fintech companies often pay more into these accounts than mainstream banks. And it will probably stay that way.
Automate savings
This could be a good place to build your savings, especially if you have payments auto-deposited regularly. By treating this account the same way you pay fixed expenses like a mortgage, rent, or car insurance, you can grow your money seamlessly.
Create a budget
Be proactive about where your money is going and identify ways to reduce unnecessary expenses. Remember, it's never too late to boost savings if you don't do it now. Be vigilant about reducing car loans, credit cards, student loans and other possible debts.
Set up an emergency fund
Many people who don't have this vital fund end up withdrawing money from checking or savings accounts, especially when something unforeseen or a disaster occurs. It is recommended that you accumulate at least three to six months' worth of expenses to provide this support.
401(k) or IRA funds
These accounts allow you to save for retirement and reduce your taxable income. Take a Roth account, for example. While taxes are paid on contributions, your withdrawals typically are not taxed in retirement.
Discover compound interest
This happens when you earn interest on your original principal and on interest accrued over time. For example, high-interest savings accounts, money market accounts, and CDs can result in compounding of the money. In general, a higher return on investment means your money adds up faster. Consider speaking to wealth managers and investment advisors about compound interest.
Take advantage of new tax breaks
Legislation passed earlier this year provides numerous reliefs that will allow individuals to save money on their 2025 tax returns. One of them is a bonus deduction of $6,000 for people aged 65 and over. Find out more here.
Look for other ways to increase income
This can help you overcome financial hurdles. Dividing your income can come from a variety of sources, including taking up a side hustle, freelancing, consulting, or part-time work. The extra money can increase your primary income.
Investigate investments
Make sure your asset portfolio aligns with your investment risk tolerance, planning horizon and financial goals. Consider investing in multiple asset classes such as stocks, real estate and fixed income to reduce risk. Consult investment professionals to rebalance your holdings if necessary due to market fluctuations.
Eliminate existing debts
This can be beneficial if you have high-interest debt. For example, pay off high-interest credit card debts first and make minimum payments on other debts. Consolidate credit card debt for as long as possible with a lower or 0% annual interest rate to pay off debt before interest charges.
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