How to Build a Simple Financial Plan for 2026

A financial plan is a structure for directing income, spending, debt, and savings.

A clear plan reduces uncertainty and supports decision-making throughout the year. The steps below outline a practical approach that fits everyday finances.

1. Establish a Baseline

Document total income, fixed expenses, variable expenses, savings balances, and outstanding debt. The Bureau of Labor Statistics reports that household spending has continued to rise across core categories such as housing, transportation, food, and healthcare.¹ A complete baseline identifies where pressure exists and where adjustments are possible.

2. Define Priorities

Identify the primary financial objectives for the year. Common priorities include emergency savings, debt reduction, retirement contributions, essential purchases, and future planning needs. Limit the list to a small number of targets so that income is allocated with purpose.

3. Build a Cash Flow Plan

Create a structured map of monthly or biweekly income and expenses. Separate fixed obligations from flexible spending. Assign a specific amount to savings and debt repayment. This reduces the influence of unpredictable spending patterns, which the Consumer Expenditure Survey has documented across U.S. households.²

4. Use Automation

Automated transfers increase consistency. Set recurring transfers for savings, retirement contributions, and necessary sinking funds. Automation prevents delays and reduces reliance on discretionary discipline.

5. Address Debt with a Defined Method

List all liabilities, interest rates, and required payments. Direct excess funds toward high-interest balances first. Prevent new unsecured debt unless essential. Maintain regular repayment schedules to limit total interest cost.

6. Prepare for Irregular Costs

Irregular expenses create financial instability when not planned in advance. Allocate monthly contributions to a sinking fund for items such as insurance premiums, property taxes, vehicle maintenance, medical needs, and annual subscriptions. This stabilizes cash flow and reduces reliance on credit.

7. Incorporate Inflation and Cost Trends

Review cost-of-living changes using data from the Bureau of Economic Analysis and the Bureau of Labor Statistics.³ Rising prices affect essential categories and should be integrated into the plan so that savings and debt strategies remain achievable.

8. Maintain Liquidity

Protect short-term stability through accessible savings. A liquid buffer absorbs unexpected expenses and prevents disruption to long-term goals. Liquidity also supports flexibility during employment changes or large household costs.

9. Align Benefits and Tax Strategy

Integrate retirement plans, health savings accounts, and workplace benefits into the financial structure. Review withholding using IRS tools to reduce the likelihood of an unexpected tax bill. Adjust contributions where appropriate based on income, benefits eligibility, and annual IRS limits.

The Bottom Line

A simple financial plan relies on clarity, structure, and consistent execution. Document the starting point, define priorities, build a cash flow map, automate key actions, and maintain liquidity. These steps create a foundation for better financial decisions throughout 2026.

If you want support customizing a plan, you can meet with our team. OneDigital’s Financial Academy provides additional material to support financial clarity and informed decisions.

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Sources:
1. Bureau of Labor Statistics. Consumer Expenditure Survey. https://www.bls.gov/cex
2. Bureau of Labor Statistics. Consumer Expenditure Survey Microdata. https://www.bls.gov/cex
3. Bureau of Economic Analysis. Personal Consumption Expenditures. https://www.bea.gov/data/consumer-spending/main

Investment advice offered through OneDigital Investment Advisors LLC.

Disclosure:
This material has been prepared for informational and educational purposes only. It is not intended to provide and should not be relied on for tax, legal or accounting advice and are not applicable to any person or organization’s individual circumstances. You should consult your own tax, legal and accounting advisors before engaging in any transaction. Additionally, any statements made reflect our views and/or best estimates, are not intended to guarantee any particular result.