As we usher in the new year, many Americans have ambitious financial goals for 2026. In fact, 84% of Americans have a financial resolution for 2026, according to a survey by Vanguard. But before looking to the year to come, looking back on 2025 might offer some valuable budgeting lessons. Explore some of the top budgeting lessons from 2025 to carry into 2026 below.
Also here are hacks for people who hate budgeting.
A Shaky Job Market Makes an Emergency Fund a Priority
After a booming post-pandemic job market, 2025 saw a slowdown in the job market, according to the U.S. Bureau of Labor Statistics. In the tech sector alone, thousands of employees were let go, according to TrueUp’s layoff tracker.
As the availability of jobs tightens and layoffs become more prevalent, the importance of building an emergency fund cannot be overstated. It’s critical to make room in your budget to build up a rainy day fund to see you through any emergencies that life throws your way, like a job loss.
Most experts recommend tucking away between three and six months’ worth of expenses. But some recommend pushing that up to cover 12 months of expenses.
When mapping out your budget for 2026, make sure to include a line item for savings to start or grow your emergency fund.
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The Cost of Essentials Likely Won’t Fall This Year
After what felt like runaway inflation for years, the official inflation has begun to fall below 3%, according to the U.S. Bureau of Labor Statistics (BLS). While that’s a big win, it doesn’t mean that prices will return to pre-2020 levels anytime soon, if ever. With costs permanently higher, it might be time to accept that reality in your budget.
Most will still reminisce the lower prices of previous years. But wishing for lower prices won’t help your budget. Instead, it might be time to take a hard look at your expenses and make deliberate choices to lower those costs.
Focus on Your Biggest Expenses
When you look back over your 2025 spending, you’ll likely notice that you spend more in some categories than others. For many households, the three biggest spending categories include housing, transportation and food. If you can make cuts to those categories, you’ll likely free up much more space in your budget than if you cut out a subscription or two.
If you want to bump up your savings in 2026, consider cutting back in your biggest spending areas. Start by assessing your food spending. For those spending a lot on takeout or dining out, that’s a big opportunity to cut back on your costs without making structural changes to your life.
For those looking to make more headway on savings, take a hard look at what you spend on housing and transportation. That might look like downgrading your vehicle to an older model without all the bells and whistles. Or even potentially dropping down to a one-car household, which could save you thousands each year.
Housing is typically a tough cost to change. But it’s still worth evaluating your options. If you’re living in a space that’s too large for your needs, downsizing could lower your costs. For example, finding a smaller apartment or moving to a more affordable neighborhood could give your budget the space you need.
A Side Hustle Could Add Some Wiggle Room Into Your Budget
If you have particularly ambitious financial goals, like paying off a large amount of debt or supercharging your savings, taking on a side hustle can give your budget the boost it needs. After all, there’s no limit to your income, but there is a limit to how much you could cut out of your spending.
Even if you only commit to a side hustle for a temporary period, the influx of extra cash could put some wind in your sails as you work toward larger financial goals.
For example, you might commit to side hustling until you pay off a big debt. After that milestone, you could pull back on extra work and enjoy a budget that doesn’t have the pinch of a big debt payment baked in.
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This article originally appeared on GOBankingRates.com: 4 Budgeting Lessons To Learn From 2025
