5 financial checkpoints for the new year

It’s incredibly easy to go off track in December, and chaotic January cashflow is an extremely common problem. Start the new year confidently by planning your next steps now.

These five financial checkpoints and practical approaches can help you regain control after a seasonal spending spree and move into the new year with clarity.

Review your tax allowances

To provide a baseline for assessing your finances as the new year begins, check your available tax allowances. Maximising contributions where possible can save you money and help you get prepared for the upcoming turn of the tax year in April.

Your first checkpoint is to assess your:

1. ISAs

Every tax year you can save up to £20,000 in an ISA, with any interest received sheltered from income tax and capital gains tax. Do you know how much of this year’s allowance you have left?

Pensions

Check your pension contributions for the current tax year. Increasing these can reduce your taxable income, alongside growing your retirement savings faster and benefiting from tax relief.

Capital gains tax allowance

Each tax year, you have a tax-free allowance for profits made from selling certain assets, such as shares or investment properties. Using your allowance before the tax year ends can help reduce the amount of tax you owe, so keeping track of your current stance here helps to maintain clarity.

2. Prioritise debt repayments strategically

Your second checkpoint is to assess your debt balances and set a plan for repayments. You may recently have spent across multiple borrowing sources, meaning some debts will be sitting at higher interest rates than others.

A recalibration of where you are will help you set priorities around what to pay down first, therefore mitigating the total overall interest charges.

The avalanche method

Focusing on paying off debts with the highest interest rates first, while making minimum payments on others, is the most effective way to reduce the total interest you pay over time. This approach is financially efficient, and helps you get out of debt faster.

The snowball method

If your debts are sporadic and fragmented, you might prefer to start by clearing your smallest debts first, then work your way up to larger balances. This method offers quick wins, ideal for a financial ‘tidy up’, and sometimes psychologically favourable depending on your viewpoint.

Consider setting up a plan to tackle any remaining balances systematically. Putting a realistic, achievable plan in place will eliminate any feelings of uncertainty, and reduce the risk of things snowballing in the wrong direction.

3. Organise your financial records

Try to avoid starting the new calendar year with an admin hangover. Taking some time to gather your financial documents and organise your records now will help you progress through the coming year 2026  with clarity.

Digital vs paper

Most statements are issued digitally these days, and important documents can easily get buried in busy inboxes. Consider setting up a filter to direct emails from specified senders directly to a ‘statements’ or ‘documents’ folder. This means they’re always easy to locate at short notice, saving you a little future time and stress.

If you tend to opt for paper documents, now is a good time to check everything is in date, accurate, and easily located. It may also be worth making digital copies of anything essential.

Create a system

Once your records are gathered, put a simple system in place to keep them organised throughout the year. This could be a digital folder structure, a labelled filing system for paper documents, or most likely a combination of both.

Putting simple systems in place now avoids scrambling to find information at tax time or when reviewing your finances further down the line.

4. Set a budget for the coming year

With your debts prioritised and your financial records organised, you now have a clear picture of your financial obligations. Use this insight as your fourth checkpoint to create a realistic budget for the year ahead. Break it down into key categories:

• Bills
• Debt repayments
• Discretionary spending
• Savings

Setting aside a buffer for unexpected costs will help you avoid going off-track as new spending needs arise. Review your budget regularly to spot misalignments early and make adjustments before they have major impact.

5. Start saving for key goals

You’ve now laid the foundations for a financially fresh new year, and can shift your focus to working towards your life goals. Your fifth and final checkpoint is your savings plan.

The insights you now have from assessing your remaining allowances and budget can be used together to draw up a plan that grows your wealth in line with your priorities. You’ll want to consider:

• What you’re saving for
• How much you need
• Where to put it

Getting this information clear will help you easily break down your goals into actionable monthly steps. If you’re unsure where’s best to save your money, or if you’re considering investing, financial advice keeps you best informed of your options.

Tailored financial advice

At Keyplan Wealth, we help our clients reach their life goals through tailored financial plans that make the most of every opportunity. Our aim is to keep you fully informed to make confident decisions when managing your wealth.

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Although the content of the article was correct at the time of writing, the accuracy of the information should not be relied upon, as it may have been subject to subsequent tax, legislative or event changes.