Annual budgeting tips to help you stay on track

For many people, it’s helpful to take time throughout the year to reflect on where they stand both personally, professionally and financially. Whether you set specific goals or simply want a clearer picture of your finances, conducting a comprehensive budget review is a smart way to understand your financial situation and plan ahead.

As you’ll discover, there are many benefits to regularly reviewing your budget and financial plan, such as: 

• Reduce your tax liability and maximize deductions 
• See if your savings and investments are on track
• Find more ways to save and pay down debts efficiently

Review and adjust your budget for the year

When considering how to review your budget, compare your planned spending versus your actual spending across each budget category, with a percentage of how much you stayed on track. It can help you set a more accurate budget for the coming year.  

How can I review and optimize my personal budget? 

1. Analyze your last 12 months of spending: Break things down according to each category, such as savings and debt payments, housing (rent or mortgage), utilities and more.

2. Review recurring subscriptions and auto-pay accounts: Take a close look at your recurring subscriptions and auto-pay accounts to figure out which ones you actually use and those you could cancel.

3. Figure out why you overspent: If you exceeded your budget in any categories, was it because you had an unexpected car repair or medical bill, or because you spent more than expected on restaurant meals and takeout? These are things to keep in mind as you put your budget together.

4. Update your annual budget: Consider last year’s budget, expected cost increases, how accurate your forecast was and be honest with yourself about how closely you can stick to your budget.

Pro tip: Use a budgeting app like ANB Go that links to your bank accounts and has automated alerts if you come close to or exceed your budget in any category. This can significantly help you with budget tracking so you’re more likely to meet your goals.

Max out or increase retirement and tax-advantaged contributions

Another important part of your financial planning checklist should involve taking a close look at your retirement and savings plans.

1. Contribute to 401(k), IRA, or Roth accounts as part of your annual planning strategy: IRS limits on retirement contributions for 2026 are $24,500 for 401(k) and $7,500 for IRAs. Contribution limits for Roth IRAs are based on income.

2. Use “catch-up” contributions: Those age 50 and older can contribute an additional $8,000 to a 401(k) and $1,100 to an IRA.

3. Maximize your matching funds: If your employer matches a percentage of your 401(k) contributions, you should contribute enough to make the most of that benefit. Otherwise, you’d be turning down free money.

4. Use health savings accounts (HSAs): If your employer offers an HSA, whatever you contribute is tax-free and can be invested. The account stays with you for life, and the proceeds are tax-free as long as they’re used for qualified medical expenses. The contribution limits for HSAs are:

HSA Coverage Types	2025	2026
Individuals:	$4,300	$4,400
Families:	$8,550	$8,750
“Catch up” for ages 55+:	+$1,000	+$1,000 (for each eligible person)

Pro tip: Whatever you set aside for retirement today can reduce your taxable income. It also leaves you better off when you retire, as your funds grow over time from compound interest.

Review your investment portfolio

Many investment advisers recommend opting for more higher risk investments when you’re younger, with the idea that you can ride out any volatility and maximize returns in the long run. Most experts advise you to rebalance your portfolios as you age to reduce risks and look for more predictable gains.

1. Evaluate asset allocation and diversification: Take a close look at where you’re allocating your funds and how diversified you need to be based on your age and goals. 

2. Rebalance stocks, bonds and cash positions: A common rule of thumb is to subtract your age from 110 to decide how much to invest in stocks. Based on this, a 50-year old you would put 60% in stocks and the rest in bonds and other lower-risk investments. 

3. Consider tax-loss harvesting for investment accounts: For any taxable investments you have that aren’t doing well, selling them at a loss can offset the capital gains taxes you pay from investments that are doing well.

Pro tip: Any review of your investments should consider your short-term, medium-term and long-term goals.

Short-term = 1-3 years, such as saving up for a car.
Medium-term = 3-5 years, such as paying off debts or saving up to buy a home.
Long-term = 5+ years, such as saving for retirement or someone’s education.

Evaluate debt and credit health

We recommend checking your credit at least once per year to look for signs of fraud, correct any errors and see monitor your progress. Your credit score can affect your ability to obtain loans and the interest rate you’ll receive. You can check your credit every week for free at AnnualCreditReport.com.  

1. Check credit reports for errors (and correct them if need be): Equifax, Experian, and TransUnion. 

2. Pay down high-interest balances: Reducing or eliminating high-interest debt, such as credit cards, can significantly improve your financial health and your credit score. 

3. Consider refinancing options for favorable rates: A home equity loan or a personal loan could reduce your interest rates and make it easier for you to get out of debt. 

4. Monitor business and personal credit for loan eligibility: Checking your credit regularly and doing what you can to improve it can help you qualify for loans at favorable interest rates. 

5. Learn these key terms when dealing with credit: 

• • Credit utilization: The amount of credit you’re using compared with your total available credit, 
  • Hard credit inquiries: Occur during formal credit applications and may temporarily lower your score 
  • Soft credit inquiries: Do not affect your credit score and may occur during prequalification or background checks 

Q. What can make the biggest improvement to my credit score?

A. Pay on time, every time, and reduce your credit utilization. 

Clean up subscriptions and recurring charges

Many people have subscriptions and recurring charges that they sign up for and seldom think about. As you review your current and future budgets, take a close look at things you spend money on out of habit and obligation. 

1. Audit all recurring subscriptions: Streaming services and entertainment, computer apps and fitness memberships 

2. Cancel or downgrade subscriptions 

3. Try to negotiate for lower rates: If you can’t negotiate, try canceling a subscription and see if they offer you a better deal. 

Solidify your emergency fund and short-term savings

Fraudsters use mobile device phishing scams to impersonate a per Financial experts recommend that every household have an emergency fund that would cover three to six months of their living expenses, preferably kept in an interest-bearing account that they could access at any time. As you review your budget consider how much you would need to live on if you lost your job, and top off your emergency fund if needed. As you draft your budget, you can also earmark different funds for things you’re saving up for, such as a vacation, replacing a major appliance or home maintenance. 

1. Identify gaps and set contribution targets: Be realistic about how much you need for your goals and how quickly you can save up for them. 

2. Track progress toward a fully funded emergency fund: Having enough emergency funds set aside can help reduce the chance that you’ll need to cover an unexpected expense by taking on debt.  

3. Use separate buckets for short-term goals: Such as vacation, repairs, gifts, etc. 

4. Explore high-yield accounts or money market accounts: Make the most of your savings by keeping them in accounts that pays the most interest. 

5. Plan for unexpected bills or healthcare costs: The more you set aside for emergencies, the better off you’ll be if you don’t have to put off a medical procedure or repairing your car. 

Q: How much should my emergency fund be? 

A: Typically three to six months of essential living expenses. You may need more if you’re self-employed, your income varies from month to month, or you’re the primary breadwinner with a family to support.  

Prepare for tax season

Organizing your records and reviewing your deductions ahead of time can help you reduce your tax liability and maximize returns. 

1. Gather receipts, invoices and financial documents. Getting annual reports from your bank, credit card company and other financial institutions can help in analyzing your budget and preparing for tax season. 

2. Review tax deductions and credits for the year. The IRS has information on tax credits and deductions for individuals online. Review this information in detail to make sure you’re taking advantage of the credits and deductions that you’re entitled to. 

3. High-value tip: Consider tax-advantaged strategies like HSA contributions. As mentioned above, it’s recommended to contribute as much as possible to your retirement plans to reduce your income tax liabilities while investing in your future at the same time.

Q. What’s the biggest thing people forget before tax season? 

A. Overlooked tax deductions and credits. 

Stay aware of local financial programs in your area

Minneapolis financial programs: 

• The Targeting Property Tax Refund: Available to qualifying Minnesota homeowners who experience a large year-to-year property tax increase. 

• The Minnesota Homestead Market Value Exclusion: Lowers a property’s taxable market value, which reduces the owner’s property tax bill for their primary residence. 

• Property Tax Deferral Program for Seniors: Available for those age 65 and older with a household income of less than $96,000. 

Omaha Financial Programs:

• Nebraska Solar Investment Tax Credit (ITC): A state-level credit that reduces a homeowner’s cost of installing solar energy systems. 

• Homestead Exemption: Provides property tax relief to seniors and people with disabilities. 

The keys to budget planning for the year

If you’re new to budget planning, keep in mind that small, consistent actions and acting responsibly can compound into long-term financial benefits—whether it’s staying out of debt, saving up for a major event or ensuring the financial security of yourself and your family. 

Reviewing and adjusting your budget and your investment portfolio should be done throughout the year to keep yourself on track and make the most of your funds. Also, take the time to evaluate your savings and expenses while setting enough aside for your short and long-term goals. Of course, you don’t have to do everything at once. Break these tasks apart into smaller, actionable steps just like you would with any major task. You should also consider automating your savings and payments with ANB Go, our online banking app.  

Download ANB Go

Your Annual Financial Review Checklist:

1. Compare actual vs planned spending from the past year 

2. Max out or increase tax-advantaged retirement contributions (HSA, 401(k), etc.) 

3. Re-balance your portfolio and harvest losses if applicable 

4. Time deductions, plan charitable giving, and estimate state/federal taxes 

5. Order and review your credit reports; dispute errors 

6. Audit subscriptions and recurring costs 

7. Top off or create a fully funded emergency and short-term savings funds. 

8. Automate savings, payments, and schedule quarterly check-ins.