It’s that time of the year again! The “ember” months are speeding past, and as we inch closer to November, the countdown to 2025 has officially begun. While most of us are busy preparing for the holiday season, getting ready for Detty December, or scrambling to finish those last-minute projects, there’s one crucial task we should not overlook: a year-end financial review.
Yes, I know—it’s been a wild year (as usual, in Nigeria), but taking stock of where your money went in 2024 could mean the difference between entering 2025 on solid financial ground or repeating the same mistakes that left you stressing over your balance at the end of the month.
So, before you get lost in the December Owambe and “Jollof Wars,” let’s talk about why you should press pause and do a deep dive into your finances. Don’t worry—it won’t be as painful as Nigeria’s traffic.
Why Conduct a Year-End Financial Review?
Your year-end financial review is like your own personal financial stock-taking—a way to assess how far you’ve come and what adjustments need to be made before 2025 kicks off. This review will help you pinpoint areas where you’ve excelled (like sticking to your January budget—if that even happened) and where you’ve fallen short (like that impulse Black Friday splurge). Ultimately, it helps you align your goals with the realities of your financial life.
Read: 7 Things You Should Never Do With Your Money
The 5 Steps to an Effective Year-End Financial Review
1. Assess Your Financial Goals
Start by reviewing the financial goals you set at the beginning of the year. Did you plan to save for that Christmas vacation or to invest in that side hustle idea finally? Pull up that list (if you have one) and compare it with what you achieved. If you hit those targets—congrats! If not, don’t stress—it’s an opportunity to course-correct and start fresh in 2025.
Tip: Write down why you missed certain goals—was it an unexpected expense, or did you simply lose focus? This will help you refine your plans going forward.
2. Evaluate Your Spending Patterns
Do a deep dive into your spending habits over the year. Break it down by categories—food, transport, data, rent, entertainment. It’s time to face the music! How much did you really spend on food delivery (Chowdeck enthusiasts, I’m looking at you)? This step helps you identify where your money went and where you can cut back next year.
Tip: Use budgeting apps to track your expenses, especially if you’ve been winging it with your finances.
Read: 7 Types of Income You Should Know
3. Check Your Savings Progress
Take a hard look at your savings. Whether it’s your emergency fund, retirement account, or savings ajo for a specific goal, how much did you save? Compare it with what you had planned at the start of the year. If you’re falling short, determine what stopped you—was it rising inflation, unplanned expenses, or inconsistent saving habits?
Tip: Automate your savings for next year to avoid “forgetting” or procrastinating.
4. Review Your Investments
Got investments in stocks, crypto, real estate, or mutual funds? Now’s the time to review their performance. Did you see growth or a downturn in any of your portfolios? If you’ve been sitting on the fence about investing, use this review to kickstart a new strategy for 2025.
Tip: If you’re unsure about investments, consult a financial advisor or consider exploring platforms like Chaka or Rise for beginner-friendly options in Nigeria.
5. Audit Your Debt Situation
Take stock of any outstanding loans or credit card debt. Whether it’s that Lapo loan, carbon credit, or your credit card balance, make sure you have a plan to pay them off. If your debt is growing rather than shrinking, consider strategies like debt consolidation or negotiating better repayment terms.
Tip: Prioritize paying off high-interest debt to prevent it from ballooning in 2025.
Read: Smart Investment Strategies for Freelancers
Bonus Tips for a Financially Smarter 2025
Set New Financial Goals: Now that you’ve reviewed your progress (or lack thereof), set clear, achievable financial goals for 2025. Whether it’s buying land, investing in the stock market, or creating a more robust emergency fund, make sure your goals align with your financial realities.
Create a Spending Plan for the Holidays: December is the peak spending season in Nigeria, with never-ending parties, family gatherings, and “emergency expenses.” Create a holiday spending plan to avoid dipping into next year’s budget.
Increase Your Sources of Income: Start thinking about diversifying your income in 2025. Whether it’s launching a side hustle, investing in rental property, or freelancing, having multiple income streams is key in today’s economy.
A year-end financial review might not be the most glamorous task on your to-do list, but it’s one of the most important. By taking a hard look at your financial habits, identifying areas for improvement, and setting realistic goals for the new year, you can build a stronger financial foundation heading into 2025.
How are you preparing financially for the end of the year? Share your thoughts below!