1. Plan your expenses in advance

The beginning of the year is the perfect time to plan for any major expenses you expect in 2026. Maybe you will need a new roof or porch, your HVAC unit might be in its final year, or it could be time for a new vehicle. Whatever large expenses you anticipate in 2026 (or next year), start saving in advance to avoid depleting your emergency fund or using credit card debt. Popular budgeting apps such as YNAB make it really easy to plan for these large, irregular expenses.

2. Make a plan to pay off high-interest debt

If you have any high-interest debt, there’s no better time than now to make a plan to eliminate it. Mathematically, it’s always better to start with your highest-interest debt and work your way down. If you can pay off all of your high-interest debt this year, that’s great, but don’t get discouraged if it will take you longer to eliminate your debt. Check your balances so you know exactly how much debt you have (it’s not uncommon for those with debt to not know exactly how bad the problem is) and budget as much as you can towards paying off your debt.

In the Financial Order of Operations, the only steps before paying off high-interest debt are covering your highest insurance deductible and getting your employer match in your retirement account. After that, everything should be put towards paying off your debt until it is gone.

3. Consolidate forgotten retirement accounts

Remember that 401(k) you had with your first job 15 years ago? Whatever happened to it? There are about 32 million forgotten or left-behind retirement accounts in the US, and many of those accounts are probably not invested appropriately or have high expenses and fees.

If you think you may have a lonesome retirement account out there somewhere, it’s worth taking some time this year to consolidate your accounts. Chances are rolling them into your current employer retirement account or IRA could give you access to better investments and lower fees and expenses. Check out our free download for help deciding what to do with your old retirement account. Even if those forgotten accounts are better off on their own, it would be wise to take a look at their investment allocation and adjust as necessary.

4. Check on your student loans

If you have any federal student loan debt, make sure your loans are current and you are enrolled in an appropriate repayment plan. Some repayment plans have been eliminated and eligibility for loan forgiveness has been further restricted. In January, the Trump administration plans to start garnishing wages for those who are behind on their student loans. It is estimated that around 5 million Americans with student loans will have their wages garnished starting this month, and millions more will be at risk in the coming months. If you have any federal student loan debt, it is imperative that you make sure your loans are current or you risk having your wages garnished.

5. Live below your means

Spending less than you make is a basic financial goal, but one well worth mentioning. 26% of Americans say they spend more than they make, and 56% of the country has at least some difficulty paying all of their bills. If you are one of the millions of Americans struggling to live below your means, it is not easy to spend less or make more, which you already know. Check out this article I recently wrote for some tips on how to get ahead financially and break the paycheck-to-paycheck cycle: “How To Build Wealth With an Average Income.”

6. Don’t forget to enjoy yourself

It’s not financially sustainable to live like a miser on ramen noodles and only spend money on the essentials. Set aside some money to spend on yourself this year. It could be as small as budgeting for a daily coffee or as big as planning your once-in-a-lifetime dream vacation. If you are saving what you know you need to be saving for retirement and are on-track elsewhere in your financial life, you owe it to yourself to splurge a bit on what you enjoy.

The beginning of the new year is a great time to make positive changes in your life, financial or otherwise, but it should come as no surprise that most New Year’s resolutions fail. To give yourself a greater chance at making changes in your own life, it’s important to set specific, realistic, and achievable goals. Ease yourself into your resolutions instead of going from 0 to 100 once the clock strikes midnight. And if you aren’t as successful as you wanted in January, there’s no need to wait until next year to try again.

Online banks vs. brick-and-mortar

I am (barely) old enough to remember when the general public was skeptical of banking online and preferred face-to-face banking rather than using a website or app. Now, only 29% of Americans prefer banking in-person. Almost all brick-and-mortar banks offer online services to their customers, but they still lag behind in many key areas. Online-only banks offer APYs 10x higher than traditional banks. It’s not all the fault of the brick-and-mortar bank; the cost to maintain physical locations certainly means they can’t compete as well on savings account interest rates.

We don’t necessarily advocate for dumping your brick-and-mortar bank, but we do think everyone should at least investigate whether or not an online bank might be a better solution for your savings account due to the difference in interest rates. If you don’t mind having more than one bank in your life, you could keep some money at your local bank and the rest in an online, high-yield savings account. There are valid reasons to utilize the services of a brick-and-mortar bank. If you are a server or in another industry where you handle a lot of cash, it is much easier to deposit that cash if you have a physical bank to go to. Sometimes it’s just easier to go down to your local bank and talk to someone rather than dealing with online customer support. An online bank may be able to meet all of your banking needs, but some still need, or want, the services offered by a brick-and-mortar bank.

How to choose the right online bank

Online banks attract consumers because of their convenience and higher interest rates than brick-and-mortar competitors. For those worried about safety, online banks typically have the same FDIC coverage as traditional banks. For most consumers, your money is just as safe at an online bank and you get the convenience of banking online and are typically rewarded with higher interest rates.

There are more online banks now than there were in the past, but a large number of them aren’t actually banks. Many of the most popular and fastest-growing banks aren’t actually banks at all, but financial technology companies backed by real banks, or neobanks. This isn’t necessarily a problem, as your money is still technically held at a real bank that is almost always FDIC-insured, but it can cause some issues you wouldn’t experience if you were using a real online bank.

Yotta is a popular financial technology company, or neobank, that has gamified saving money on their platform. They may have taken it a little too far, leaning too heavily into the gamifying aspect of their services, and ultimately, turning into a form of gambling. Now customers are unable to get their money out of the financial technology company. Perhaps the largest bank-that-isn’t-actually-a-bank, Chime, has its own share of unique issues. I am a former customer of Chime and was a little unsettled reading horror story after horror story of other customers having their account closed for no reason and often unable to get their money back. ProPublica covered the issue in-depth and made sure to emphasize that Chime was not, in fact, a bank.

The worst-case scenario of your account being closed or being unable to access your money might not happen to you, but I have found financial technology companies that offer banking services prioritize the technology over the banking services. With my former neobank, the website was seriously barebones, and you could only do most things from the app. This isn’t always a problem, but sometimes I only had access to my computer. The final straw was being unable to order checks. Yes, I know hardly anyone uses checks anymore, and I use them so infrequently that it hadn’t been an issue, but my neobank was unable to provide me with checks even though I was willing to pay for them.

Online banks are great, but it may be worth sticking with an actual online bank instead of a financial technology company that isn’t a true bank. Myself and some others at The Money Guy Show use Ally Bank. They offer competitive savings account rates and they have been in business for over 100 years now. No matter what bank you end up choosing, look for a bank that is actually a bank, is FDIC insured, offers competitive rates, and didn’t just pop up overnight.

A checking account at a bank isn’t as sexy as a Roth IRA or 401(k), but having a great bank is foundational to your financial life. It can mean the difference between your money being there when you need it or your money not being there. A higher yield on your savings account might mean achieving financial goals, like saving for your first home, just a little bit sooner. Don’t overlook your decision of who to bank with, and while switching banks is never easy, it could put extra money in your pocket or even save you from a nightmare scenario of losing access to your money.

In this highlight, we discuss how you can afford a home with high interest rates and what guidelines you should aim to follow.

For more information, check out our Home-Buying Checklist!