The new year is often the right time to reassess your financial situation, make improvements, and set fresh goals. It offers an opportunity to realign your spending, savings, and investments with a clearer sense of direction.
India’s economic outlook is also showing strong signs of resilience. For the ongoing financial year 2025–26, the RBI has revised India’s GDP growth estimate upward from 6.8% to 7.3%, indicating stronger growth compared to last year. Additionally, real GDP growth touched 8.2% in Q2 of FY26.
As the country’s economy continues to strengthen, this is a good time to focus on your own personal financial growth. The five tips below can serve as practical guidance to help you make better financial decisions in the new year.
1. Create a Budget and Track It Regularly
A budget helps you understand where your money is going rather than restricting your spending. Start by listing all sources of income and expenses, both essential and discretionary.
Tracking expenses throughout the month provides a clearer picture of spending patterns and highlights areas where small adjustments can make a difference.
Example: Cutting down Rs 100 a day on avoidable expenses can add up to nearly Rs 3,000 a month, which can be redirected towards savings or investments.
2. Strengthen Your Emergency Fund
An emergency fund acts as a financial cushion during uncertain times, such as medical emergencies or job-related changes. It helps manage sudden expenses without disrupting long-term plans. Keeping this fund separate and easily accessible is equally important.
Tip: If monthly expenses are Rs 40,000, gradually building an emergency fund of Rs 1,20,000–Rs 1,60,000 can provide reasonable financial security.
3. Reassess Existing Debt Carefully
High-interest debt can slow financial progress over time. Reviewing all outstanding loans and understanding their interest costs can help prioritise repayments. Reducing high-interest liabilities first often frees up more money for savings and investments later.
Example: A Rs 50,000 credit card balance at 24% annual interest results in nearly Rs 12,000 in interest payments every year.
4. Review and Adjust Your Investment Strategy
Investments should evolve with changing goals and life stages. Reviewing your portfolio periodically ensures that asset allocation remains aligned with your risk appetite. A diversified portfolio can help manage market volatility more effectively.
Tip: Including a mix of equity, debt, gold, and other asset classes can add stability to long-term investment plans.
5. Keep Improving Financial Awareness
Sound financial decisions often stem from a basic understanding of money matters. Learning about taxation, investments, and retirement planning can help avoid costly mistakes. Simple steps like reading articles or attending webinars can gradually build financial confidence.
Example: Reading one financial article a week or completing a basic online course during the year can make a noticeable difference over time.
By following these five steps, financial planning in the new year can feel more structured and manageable. Consistency and small improvements often lead to better long-term outcomes.
*The article is for information purposes only. This is not investment advice.
*Disclaimer: Teji Mandi Disclaimer
