With the year winding down, now is the time to get your financial house in order. A few smart moves before 2026 arrives can make a big difference for your wallet, your taxes, and your long-term goals. For those of us juggling careers and family while planning for the future, a year-end financial check-in is essential.

This is not about drastic changes. It is about making small, strategic adjustments that set you up for success. From boosting your retirement savings to trimming your tax bill, these practical steps can provide peace of mind and put you on stronger footing for the year ahead.

Review and Adjust Your Budget

A budget is the foundation of any solid financial plan. Before the new year, take a close look at where your money has been going. Many budgeting apps can automatically track and categorize your spending, making this process simple.

Identify areas where you can cut back. Are there subscriptions you no longer use or expenses that have crept up over time? Redirecting even a small amount each month toward savings or debt can have a major impact. This review also helps you set a realistic budget for 2026.

Build Up Your Emergency Fund

A well-stocked emergency fund is your buffer against life’s surprises. Financial experts recommend having three to six months' worth of essential living expenses saved in a liquid account. If your fund is looking a little low, make it a priority before year-end.

Consider setting up automatic transfers from your checking to your savings account. This "pay yourself first" approach makes saving effortless. With interest rates still relatively favorable, a high-yield savings account is a great place to park this cash so it can earn some interest while remaining accessible.

Maximize Your Retirement Contributions

One of the most powerful moves you can make is to boost your retirement savings. The money you put into a traditional 401(k) or IRA lowers your taxable income for the year, a win-win for your present and future self.

  • Meet Your 401(k) Match: At a minimum, contribute enough to get the full matching contribution from your employer. Not doing so is like turning down free money.
  • Max Out If You Can: The contribution limits for 401(k)s and IRAs often increase each year. Try to contribute as much as you can.
  • Leverage Catch-Up Contributions: If you are age 50 or older, you can contribute an extra amount to your retirement accounts. This is a fantastic opportunity to accelerate your savings as you get closer to retirement.

Optimize Your Tax Strategy

Year-end is the perfect time to make moves that can lower your tax bill. A little planning now can save you a lot of money in April.

Harvest Your Investment Losses

If you have investments in a taxable brokerage account that have lost value, you can sell them to realize a loss. This strategy, known as tax-loss harvesting, allows you to offset capital gains. If your losses exceed your gains, you can use up to $3,000 to offset your regular income. This is a practical way to find a silver lining in a down market.

Bunch Your Deductions

With the standard deduction at a high level, many people no longer itemize. However, if your deductible expenses are close to the threshold, consider "bunching" them. This means consolidating deductible expenses into a single year. For example, you could make your January mortgage payment in December or make two years' worth of charitable donations before the year ends. This could push you over the standard deduction, allowing you to itemize and claim a larger tax break.

Give to Charity

Donating to a qualified charity is a great way to support a cause you care about while also getting a tax deduction. If you itemize, you can deduct your cash contributions. You can also donate appreciated stocks. This allows you to avoid paying capital gains tax on the stock's growth and deduct its full market value.

Pay Down High-Interest Debt

Carrying high-interest debt, like credit card balances, is a guaranteed way to lose money. The interest rates on these debts are often over 20%, far higher than any guaranteed return you could earn from an investment.

Use any extra cash from a bonus or a trimmed budget to attack this debt. Start with the balance that has the highest interest rate. Paying it off is like getting an immediate, guaranteed return on your money.

Review Your Insurance Coverage

Your insurance needs can change over time. The end of the year is a good time to review your life, disability, home, and auto insurance policies. Make sure your coverage still aligns with your current situation.

Have you made major home improvements or acquired new valuable assets? You may need to update your homeowner's policy. Have your income or family responsibilities changed? It might be time to adjust your life insurance. Shopping around for policies can also save you money.

Making these smart money moves before 2026 begins provides a powerful sense of control over your financial future. By taking these practical steps, you can lower your stress, reduce your taxes, and build a stronger foundation for achieving your long-term goals.