Peter Hoglund, AIF®, CFP®, a Senior Vice President and Financial Advisor at Wealth Enhancement Group in Warren has extensive experience helping clients navigate their financial journeys. In this Q&A, he shares how individuals can prioritize financial wellness and prepare for the challenges and opportunities that 2025 may bring.
1. As we kick off 2025, what financial habits do you recommend individuals prioritize to achieve long-term financial wellness this year?
It’s important not to take anything for granted. Many people think that financial wellness is simply about checking off items on a to-do list, but in reality, life is always changing. The key to long-term financial health is maintaining flexibility and adaptability in your financial habits. Focus on reviewing and adjusting your financial plan regularly, ensuring it aligns with your evolving goals, circumstances, and the broader economic landscape.
2. Looking ahead to 2025, what do you see as the top financial challenges people may face, and how can they best prepare for these?
Taxes will likely be a top concern in 2025, especially with potential changes in tax policy. Tax planning should not be done in hindsight—consider your tax strategy over the next few years, rather than just reflecting on the past year. Americans tend to favor tax deferral, preferring to delay taxes in favor of a future that might be more tax-friendly. However, this doesn't always work out as planned. Preparing for the possibility of higher taxes in the future can help you better understand the cost of continuing to defer taxes and make more informed decisions about your financial future.
3. New Year’s resolutions often focus on personal improvement—how can people incorporate financial wellness into their resolutions for 2025?
Financial wellness is a critical component of overall well-being. Stress is a part of modern life, and while mental health awareness has grown, financial stress remains a major source of anxiety for many. To incorporate financial wellness into your resolutions, start by exploring your emotional relationship with money. How do you feel when you check your bank or investment accounts? Are you reluctant to budget, or do you avoid thinking about future expenses? By identifying these emotions, you can start to shift your mindset and approach your finances with greater confidence and clarity. Take 2025 as an opportunity to address the financial stressors in your life and create a healthier relationship with money.
4. With rising inflation and shifting interest rates, how should people adjust their budgeting and savings strategies this year?
Rising costs have become a normal part of our financial reality. A $1.00 bag of chips now costs $2.99, and we feel the impact, even if we’ve grown accustomed to it. If you’ve been tightening your belt for a few years (perhaps on big-ticket items like vacations or home improvements), take a step back and ask yourself if these expenses are still necessary or if there are more affordable alternatives. It’s important to adjust your expectations to reflect the current economic environment, as prices for many goods and services may never fully return to pre-inflation levels. Accepting this reality and adjusting your budget accordingly can help you achieve financial stability in 2025 and beyond.
5. What financial goals should individuals focus on in 2025, and how can they ensure these goals are realistic and achievable?
Financial goals are about making choices—deciding what’s most important to you and focusing on what you can realistically achieve. Start with goals that are achievable in the short term, then break them down into manageable steps. If one of your goals is a larger, long-term ambition, break it into smaller milestones to stay on track. The key is to remain flexible and be willing to adjust as you go, ensuring that your goals remain realistic and attainable as circumstances change.
6. For those thinking about retirement, what are the most important steps to take in 2025 to ensure a secure and comfortable future?
Approach retirement not as an end, but as the beginning of a new chapter in your life. Just like transitioning to college or changing careers, retirement comes with both challenges and opportunities. If you're more than 10 years away from retirement, continue prioritizing growth and saving. As you get closer, start thinking about how your retirement assets will be used to cover living expenses in retirement. For those within five years of retirement, avoid the temptation to take on too much risk in an attempt to "make up" for any shortfall in retirement assets. Instead, focus on steady, reliable strategies that will allow you to maintain financial security during retirement.
For more information visit wealthenhancement.com.
"To incorporate financial wellness into your resolutions, start by exploring your emotional relationship with money. How do you feel when you check your bank or investment accounts? Are you reluctant to budget, or do you avoid thinking about future expenses?" - Peter Hoglund, AIF®, CFP® | SVP Financial Advisor