How to Achieve Your Financial Goals in 2026If you’ve been waiting for the perfect time to get serious about financial goal setting, your wait is over. January is Financial Wellness Month, and the fact that it coincides with the New Year makes it the ideal time to embrace a fresh start and focus on working toward your financial goals.
Are You Achieving Financial Wellness?
Financial wellness isn’t just about having a good income. It’s about developing the habits and knowledge to achieve your financial goals in both the short term and the long term.
According to PYMNTS research, 67% of Americans say they live paycheck to paycheck. That’s two out of every three Americans – and it’s not just low-income workers. A rising number of high-income earners, defined as those earning at least $100,000 a year, report living paycheck to paycheck, while 25% of lower-income individuals say they do not live paycheck to paycheck.
Regardless of how much you earn, if you spend more than you bring in, you’ll go broke eventually. As proof, consider the fate of many lottery winners. According to USA Today, data from the Certified Financial Planner Board of Standards reveals that nearly one in three lottery winners eventually declare bankruptcy, a higher rate than what’s seen among the general American population.
What’s Standing in the Way of You and Your Financial Goals?
Although many people share similar financial worries, everyone’s financial situation is different.
- You haven’t set your priorities. Have you ever sat down to add up all money you spend on things like coffee and streaming services over the course of a year? Once you crunch the numbers, you may find that little things add up to a substantial chunk of your discretionary income. Often, these items aren’t truly a person’s financial priority, but because they haven’t actually written out their priorities and created a matching budget, it’s where they end up spending their money.
- Your budget isn’t realistic. If you find yourself spending more than your budget every month, the problem might not be that you lack financial discipline. Instead, the issue may be that your budget is unrealistic. Maybe it was based on costs five years ago, and inflation means you can no longer stick to those amounts, or maybe you forgot to include key categories of spending, like pet food or out-of-pocket medical and dental care.
- You haven’t planned for emergencies. You may be sticking to a regular monthly budget most of the time, but what happens when your dog needs an emergency trip to the vet, your car breaks down, or your washing machine needs to be replaced? Over the period of a year, it’s reasonable to expect some emergencies to arise, and if you’re not prepared financially through savings, insurance and warranties, normal emergencies can derail your financial plan.
- You lack the expertise needed to make the right financial moves. A lack of financial knowledge can stand between you and your financial goals. Without a thorough understanding of financial concepts, and without an expert to guide you through your decisions, you could end up leaving money on the table.
Are You Financially Literate?
Financial literacy refers to having the financial knowledge and skills to manage money effectively while saving, budgeting, investing and paying off debt.
According to the World Economic Forum, many U.S. adults lack financial literacy. When asked a five-question quiz designed to test basic financial knowledge, only 26% could get four or five questions right, while 24% only got one or no questions right.
Another quiz, called The Big Three, uses three simple questions to test financial literacy. You can take the quiz at the Stanford University Initiative for Financial Decision-Making website. If you miss a question, don’t feel bad – only 28% of American adults are able to answer all three questions correctly. Most Americans have a lot to learn when it comes to finances.
Starting the New Year Right
The new year is a perfect time to shed bad habits, work toward new goals, and brush up on your financial education. Whether you’re just starting out in your career, buying a home and raising a family, or getting ready to retire, financial knowledge can empower you to reach your financial goals.
Embarking on a financial education is easier when you have a knowledgeable advisor in your corner. The Heffernan Financial team, a division of Heffernan Insurance Brokers, offers financial education and empowerment for people in all stages of life. Learn more.
