Survey finds holiday spending in the US is decreasing, especially among Gen Z
According to CNBC, holiday shoppers in the U.S. are expected to skip this season.
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- The end of the year is a great time to review your budget, emergency fund, and debt repayment plan.
- Experts suggest preparing for tax season now by organizing your receipts, checking your tax withholdings, and considering recovering any losses.
- Reviewing and maximizing your contributions to retirement accounts such as 401(k)s and IRAs can help ensure your future financial security.
- Financial advisors recommend setting new goals for 2026 and understanding how new legislation will impact your finances.
As Americans decorate their venues and work on their gift lists, this holiday season is also a great time to reflect on their personal finances.
Economic uncertainty appeared to characterize 2025. Rising tariffs increased volatility, a cooling job market challenged workers and stagnated inflation. Nevertheless, an AI investment boom and strong spending by high-income households supported growth in some sectors. But for other businesses, the affordability crisis continued to rise.
If you’re looking to end this year on the right foot, these year-end financial tips from our experts can help set you up for a strong start into 2026.
1. Take inventory
The end of the year is often a good time to reflect on what went well and what didn’t in 2025.
Jack Howard, director of money wellness at Ally Financial, said he understands that some Americans are stuck in a spiral of ruin, thinking the economy is “crazy,” inflation is high and they’ll never retire.
“You could think of it differently. 2025 was a difficult year for a lot of people. I set a goal and I didn’t achieve it, but I’m really proud that I set a goal and I’m going to move forward and work toward it,” Howard said.
she suggests Review your spending and adjust as necessary You can better align your budget with your values.
It’s also wise to review your emergency fund. Consider replenishing your fund if you drained it this year and increasing it if your expenses increase. Also check to see if you have any debts. Figure out how much you owe and come up with a reasonable repayment plan.
December is also a good time to review estate plans, powers of attorney, and insurance coverage.
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2. Prepare for tax season
Tax day is still a few months away, but you can start preparing now.
Make sure your withholdings are correct to avoid owing too much to the IRS. Track your expenses and organize receipts for deductible purchases. If you plan to make an itemized donation, please consider making a charitable donation by December 31st. However, depending on your circumstances, there may be reasons to refrain from making year-end donations.
Make the most of your tax-advantaged accounts. Use funds in your flexible spending account before they expire and consider contributing to a 529 education savings plan or similar alternative.
If you have taxable investments, you may consider recovering your tax losses or selling your investments at a loss to offset your capital gains taxes. Miklos Ringbauer, founder of accounting and tax strategy firm MiklosCPA, said it was a “huge misconception” that the strategy was only for the wealthy.
To ensure a smooth tax season, Ringbauer recommends keeping records of all financial activities and consulting a professional before making important decisions.
“You don’t have to do it five times a year, but every year or every few years, consult with a reputable accountant you know and trust to provide support, especially after major tax legislation is enacted,” Ringbauer said.
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3. Review your retirement investments
If you have extra cash, the end of the year is also a good time to maximize contributions to your retirement accounts.
“I want you to put as much money into your 401(k) as you can, and your 59-and-a-half-year-old self will thank you,” said Judith Leahy, senior wealth advisor at Citi Personal Wealth Management.
In 2025, individuals will be able to contribute up to $23,500 to a 401(k) plan. IRA contributions are limited to $7,000 if you are under age 50. If you’re 50 or older, you can contribute $8,000.
If you have a traditional retirement account, you may want to consider transferring to a Roth or transferring your traditional pre-tax retirement savings to a Roth IRA, depending on your situation, Leahy says.
People age 73 and older should also make sure they are withdrawing required minimum distributions from IRAs, 401(k)s, and other plans. Otherwise, you may be subject to 25% tax on the amount not withdrawn.
“If you don’t get it done, you’re going to get a penalty,” Leahy said. “If you don’t need the money, make sure you’re doing charity work so the money goes to the charity of your choice and you don’t have to pay taxes.”
Please make sure the beneficiary on those accounts is up to date.
4. Plans for 2026
Once you feel confident in 2025, start preparing for 2026.
Set new financial goals and schedule regular check-ins to track your progress.
You can also take the time to consider how new laws, such as the One Big Beautiful Bill Act, will affect you. USA TODAY analyzed the bill’s winners and losers. The change is likely to help high-income earners, families with children, car buyers, people who receive overtime pay and tipped workers. People with incomes under $50,000, SNAP and Medicaid recipients, people with student loan debt, and undocumented immigrants benefit less.
Contact Rachel Barber rbarber@usatoday.com X Follow her at @rachelbarber_
