Now that 2025 is here, it’s time to make sure your finances are set up for success as we look ahead to the rest of the year. It’s a good idea to see where your finances have performed well and what needs to be improved.
If you want to set yourself up for success, you need to approach your wealth from all sides, from lifestyle expenses to investments. Here are three ways you should look into your finances for the remainder of 2025 and beyond.
1. Update your budget
Inflation has risen drastically over the last several years. 2022 alone saw an 8% increase in inflation. If your budget is calculated on the goods and services rates of prior years, you might find yourself going through more cash than expected.
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Having an accurate budget can make a big difference if you need to determine your liquidity at any moment. If a solid investment opportunity arises, you don’t want to hesitate because funds are short.
2. Keep up to date on tax changes
So far, 2025 has already seen some significant tax changes. Some have already been announced and can be planned for. For example, IRA limits are staying the same but maximum HSA contributions will be raised to $4,300 for individuals and $8,500 for families.
Others are up in the air. For example, provisions of the Tax Cuts and Jobs Act (TCJA) are still set to sunset this year. However, it is very possible that the new administration will extend those provisions. These next two years could potentially see major tax changes, especially for high earners.
Keeping up to date on tax changes for this year — as well as 2026 — will allow you to make advantageous decisions for new investments and other tax strategies. Make sure to keep your ear to the ground regarding any issued IRS updates.
It’s also a good idea to consider joining a mastermind group that specializes in tax strategy. Peer groups and mentorship can often be more beneficial than a single adviser, as having more peers to consult with when it comes to your tax strategy and alternative investing can simply offer you more perspectives.
3. Diversify your portfolio
Always take the time to assess your portfolio as a whole. Identify where you might be open to vulnerabilities with inflation and other economic fluctuations such as the housing market.
If you review your portfolio and notice that a large proportion of investments are susceptible to the same economic factors, it’s time to consider alternatives.
For example, oil royalties can provide steady long-term income. And best of all, royalty rates are regularly adjusted for inflation. So that income should remain steady even if your other investments take a hit from inflation.
When dipping into alternative investments, you don’t need to jump into it with huge sums. Even just a few percentage points of your overall portfolio can keep things more stable when economic swings occur.
Make 2025 a profitable year
It will be fascinating to see what the rest of 2025 brings. Whatever changes and updates come your way this year, you’ll want to get yourself in a good position to adapt.
Analyzing your spending and portfolio now can yield the necessary data you need to set yourself up for success.
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The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.
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