Month 12: The Annual Review and Looking Ahead

Congratulations! You have spent an entire year being mindful and proactive with your money. This final month is about reflection and preparation for the year ahead. Look back at your budget from Month 2. How has it changed? What did you learn about your own habits? Acknowledge your progress—you’ve built an emergency cushion, planned for irregular costs, and found ways to save on major expenses.

Now, look forward. The Social Security Administration typically announces a Cost-of-Living Adjustment (COLA) late in the year, which will affect your income for the next year. You can find this information on the Social Security Administration website. At the same time, you know that some of your costs, like rent or insurance, might also increase.

Your task is to create a new “every dollar” budget for the upcoming year, using your new income number and any anticipated expense increases. You are no longer starting from scratch. You now have a full year of data and experience. You have a system that works. This annual review will become your new yearly tradition, ensuring your financial plan always stays current, effective, and ready for whatever comes next.