The year 2024 taught us valuable money lessons that we can carry into 2025. Many Americans learned the importance of automating their savings, even if it was just a small amount each month. Those who had automatic transfers set up were able to build a safety net without much effort, while those who tried to save whatever was left at the end of the month struggled.
The collapse of Silicon Valley Bank and the rise in credit card debt highlighted the necessity of having an emergency fund. Financial experts recommend building an emergency fund in layers, with some money in high-yield savings accounts, some in easy-to-sell investments, and some in I-bonds. This approach provides multiple options when faced with unexpected expenses.
Many people also realized the impact of small monthly charges, such as subscriptions to streaming services and apps. By auditing their subscriptions and canceling unused ones, they were able to save hundreds of dollars each month. Spending data from 2024 showed that while overall shopping decreased, people continued to spend money on things that mattered to them, such as experiences with friends and family.
Lessons from the past year
This shift in priorities emphasizes the importance of spending money on things that bring happiness and fulfillment. Another lesson learned was that chasing higher returns at any cost doesn’t always pay off.
Instead, people focused on finding reliable returns and sticking with them. Sometimes, “good enough” is indeed good enough. Lastly, the traditional rule of saving six months of expenses needed an update.
People are now trying to both save and invest more to build a stronger financial safety net. In 2025, this might involve a combination of high-yield savings accounts, conservative investments, and I-bonds. As we enter 2025, these financial lessons from the previous year will help us navigate the challenges and opportunities that lie ahead.
By prioritizing savings, building emergency funds, being mindful of expenses, and focusing on experiences that bring joy, we can set ourselves up for financial success in the coming year.
