There is no better time than the new year to plan ahead, especially when it comes to your finances. As 2024 comes to an end and we look forward to 2025, taking a proactive approach can help you make progress toward your most important financial goals.
Whether your goal is to pay off debt, save for a vacation, or increase your retirement savings in 2025, the first step is to create a plan, says Jamie Golombek, managing director of tax and estate planning at CIBC Private Wealth in Toronto. A well-thought-out plan can help you take small, practical steps—such as reviewing your budget, ensuring your investments align with your goals, and setting up a consistent investment plan—to create the financial future you want for yourself and your family.
Not sure where to start? Here are Mr. Golombek’s top recommendations to help you achieve your financial goals in 2025:
1. Understand Your Financial Situation To make informed financial decisions, you first need a clear picture of your income, savings, and spending. Knowing exactly how much money is coming in and where it is going allows you to prioritize what matters most.
Mr. Golombek recommends starting by listing your household income and both fixed and variable expenses.
“Then, look at what’s left over, because that’s the money to put toward your goals,” he says. Tools like CIBC’s budgeting calculator can help you determine how to make your money work more effectively.
2. Set Clear Financial Goals “A common challenge for Canadians is having multiple financial priorities—from paying off debt to saving for long-term goals like retirement,” says Mr. Golombek. Since it may not be possible to accomplish everything at once, planning helps determine which goals to focus on first.
To get started, write down your goals. Begin with short-term priorities—things you want to achieve within six months to a year, such as paying off credit card debt. Then, list medium-term goals that you aim to reach within one to five years, such as buying a car or taking a vacation. Finally, include long-term goals that are at least five years away, such as retirement or purchasing a home.
Clarifying your priorities can help you make smarter financial decisions. For instance, focusing on paying down debt first can put you in a stronger position to save for retirement later.
The more specific your goals, the easier it will be to take action. “Goals should be specific, measurable, and time-bound,” says Mr. Golombek. For example, instead of saying, “I want to save for retirement,” a more effective goal would be, “I want to save $500,000 by age 65.”
Planning tools, such as CIBC’s retirement savings calculator, can help you stay on track.
3. Start a Regular Investment Plan Once you have set your budget and prioritized your goals, it’s time to put your extra money to work, says Mr. Golombek.
Regular investing—consistently contributing to your investment portfolio—can help you build financial momentum. This strategy makes saving automatic and turns investing into a regular expense in your budget. It also allows you to take advantage of long-term growth and compound interest.
Diversifying your investments is key to managing risk while achieving steady growth, says Mr. Golombek. Spreading investments across different asset types, industries, and geographical regions can help protect your portfolio from market fluctuations.
“An advisor can help you create a diversified investment plan that aligns with your risk tolerance and financial goals,” he says.
4. Take Advantage of Registered Savings Accounts Registered savings accounts, such as RRSPs (Registered Retirement Savings Plans), can help grow your wealth by offering tax benefits on investment earnings and gains.
“These accounts provide significant tax advantages, so not using them fully could mean missing out on potential savings,” says Mr. Golombek. A financial advisor can help ensure you are making the most of these accounts.
Different registered savings plans offer unique benefits. For instance, an FHSA (First Home Savings Account) is ideal if you’re saving for your first home, as it allows tax-free savings for that purpose. An RESP (Registered Education Savings Plan) can help you save for your child’s post-secondary education with tax-free growth and government grants. A TFSA (Tax-Free Savings Account) is a flexible option for any savings goal, as investment earnings and withdrawals are tax-free.
For individuals with disabilities, an RDSP (Registered Disability Savings Plan) provides additional government grants and bonds, with potential contributions of up to $90,000 based on eligibility.
Once you decide which registered accounts suit your goals, setting up automatic contributions on a weekly or monthly basis can make saving effortless, says Mr. Golombek.
“By automating contributions, you remove the temptation to spend that money elsewhere.”
5. Plan Your Estate While saving and investing help build your financial future, estate planning ensures that your assets are distributed according to your wishes. It is important for anyone who wants to provide for loved ones or contribute to charitable causes.
“Many people think estate planning is only for the wealthy, but it’s essential for anyone with financial assets,” says Mr. Golombek.
A will is a key part of estate planning, as it specifies how your assets should be distributed. However, estate planning also includes appointing power of attorney for property and health care, tax planning, and possibly life insurance strategies.
Start the Year with a Strong Financial Plan Whether you are just beginning to budget, considering estate planning, or working on another aspect of your financial strategy, getting started can feel overwhelming, says Mr. Golombek. But you don’t have to do it alone.
A financial advisor can provide guidance and expertise to help you reach your goals.
“A good advisor can use their knowledge to your advantage, connect you with other professionals as needed, and help implement the right strategies to achieve your financial goals,” he says.
