Welcome to NerdWallet’s Smart Money podcast, where we answer your real-world money questions. In this episode:
Learn how to tackle financial regrets, set achievable money goals, and make 2025 your best year, financially.
How can you avoid repeating my biggest financial regrets this year? What are simple steps to improve your savings and spending habits? Hosts Sean Pyles and Sara Rathner discuss financial regrets and practical resolutions to help you take control of your money in 2025, beginning with a discussion of top financial regrets from 2024. Then, Sara talks to NerdWallet Senior Economist Elizabeth Renter about strategies for creating achievable money goals and overcoming common financial missteps. They share tips for mindful spending, setting boundaries for entertainment and dining budgets, and building habits that improve your credit score.
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Episode transcript
This transcript was generated from podcast audio by an AI tool.
It’s a new year. We’ve left 2024 behind. All there is now is to look forward, right? Well, yes. But it’s also a good time to reflect on what could have gone better in our financial lives last year and what we can learn from our regrets.
There’s always room for improvement, especially when it comes to savings. You can always save more. The top-cited regrets involved saving in 2024, or the lack thereof. Twenty-nine percent of Americans regretted not saving for emergencies, and 27% regretted not saving for financial goals last year.
Welcome to NerdWallet’s Smart Money podcast. I’m Sean Pyles.
And Sara, before we get to anything else, Happy New Year.
And a very Happy New Year to you, too, Sean. So, did you Auld Lang Syne your way into January?
I am not even sure what that means, Sara.
Me neither, but I remember that line from When Harry Met Sally. Millennials, you know what I’m talking about. Older than that, you know what I’m talking about. Gen Z, When Harry Met Sally is a great movie, and you should watch it. Anyway, at the end, they’re at a New Year’s Eve party, and she says that she thinks that song is about old friends, so I’ll buy that.
I’ll buy that too, even though I have not seen that movie. I’m such a young millennial over here.
What? So now you have a goal for 2025: watching that movie.
I’ll add it to my list, which is already very long.
Anyway, Sara, do you have any big money goals for the year?
Well, this is kind of a three-year goal, but we’re saving up to eventually finish our unfinished basement. Otherwise, I have some travel goals, which are sort of like money goals because travel costs money. I just booked a trip with an old friend. We’re going to escape from our children and just hang out and eat, drink and be merry. Also, trying to plan a trip with my family too. What about you?
Those trips sound really fun. On my end, after a few years of pretty tame financial goals, I have a lot on my plate this year. I’m going to sell my house this spring. I’m hopefully going to have my financial planning firm up and running by mid-year. This fall, my partner and I are finally getting married, and we have a trip to London somewhere in the mix too, so I have a lot going on in 2025.
Yes, you do, but it’s all good stuff.
So, Sean, even though we want to move forward and into this new year, today we are going to harken back to the old days of last year, all the way back a couple of days, and think about what we could have done differently and/or better when it comes to our finances. And to that end, NerdWallet does this annual survey at the end of each year asking people about their money regrets. Ouch. We’re going to hear about that today.
And about how to turn those frowns upside down. I’m always up for learning from past mistakes; otherwise, what’s the point of making them?
I would rather not make them in the first place. But if they’re going to be made anyway, yes, let’s learn from them.
As we start a series of episodes looking at your money in 2025, we want to hear what you think, listeners. What are you working on in your financial life as you start the new year? Leave us a voicemail or text the Nerd hotline at 901-730-6373. That’s 901-730-NERD, or email a voice memo to [email protected].
Up next, we’re talking with NerdWallet Chief Economist Elizabeth Renter about that survey and her advice for making this coming year the best ever — financially speaking, at least.
Elizabeth Renter, Happy New Year. And I really hope that you don’t have very many regrets from 2024. I mean, at least not financial ones, maybe some fun ones.
Hey, Sara. Thanks, and Happy New Year. Thanks for having me. Some of those regrets I’m going to keep to myself.
Probably a wise decision.
I did do a lot in 2024, and financially, that included paying off my master’s degree and selling a home to move halfway across the country. So, there were some big financial milestones, but also room for improvement. I think there’s always some room for improvement when it comes to our finances, even if we don’t necessarily have regrets.
And we’re going to get into Money New Year’s resolutions a little bit later on. But first, let’s turn the clock back to, I don’t know, two days ago when it was still 2024, and now it’s 2025. Let’s talk about financial regrets from 2024. We’ve got this survey conducted for NerdWallet by The Harris Poll. Let’s start with how many of us have money-related regrets. Hopefully, not a lot.
Well, actually, most of us have money regrets for the year. Sixty-nine percent of Americans say they had financial regrets for 2024, and those range from not saving enough to overspending on a variety of categories.
I am definitely sorry to hear that, but maybe a few more hours spent listening to the Smart Money Podcast, hint, hint, will help with that for this year. Let’s break this down by generation. Who’s got the most regrets?
To your point, we’re going to do what we can to help that out, but it was the youngest generation that was the most likely to have such regrets. Eighty-nine percent of Gen Z, compared with 80% of millennials, 73% of Gen X, and less than half — or 46% — of baby boomers had money regrets for 2024, which, if you think about it, makes some sense. Baby boomers are at the life stage where they’re most likely to be financially secure. And I don’t know, there’s something about getting older where I just feel like maybe you let go of things that other people would normally regret when they’re younger.
Honestly, it’s like you just don’t have time for regret after a certain point.
You want to spend your time doing more important things. And honestly, to the other end of the spectrum, Gen Z, younger adults just getting started, establishing themselves financially, a big cohort of that generation is still school-aged, so they’re not necessarily fully financially independent yet. But yeah, I mean, I remember being that age and you’re just figuring it out. You’re taking those wobbly, first baby deer steps into managing your money, and it’s terrifying, honestly.
I still have money regrets from 1998 or so.
Yeah. The more you do certain financial tasks, the more they become easy and routine.
And then you feel empowered to do things that are even more complicated, and honestly then your life gets more complicated, too, and you have no choice but to respond to that. I could definitely see the older you get, the more comfortable you are managing your money, and so you regret less.
Absolutely. And then having more money as you get older helps, too.
Yeah, no regrets to having more money. That would be my least regret. “Oh, I really regret making so much money last year. It was so tough.” All right. We know who regrets a lot, but let’s talk about what they regret. What are some of the top regrets folks have from their financial lives last year? First up, savings. I imagine we all regret not saving more, right? You could always save more, but saving for what exactly?
Well, you’re right. There’s always room for improvement, especially when it comes to savings. You can always save more. The top-cited regrets involved saving in 2024, or the lack thereof. Twenty-nine percent of Americans regretted not saving for emergencies, and 27% regretted not saving for financial goals last year.
And of course, on the opposite side of the coin — no pun intended — we have spending. Honestly, I regret spending on some of the things I had to do to fix my house this year. I know you sold your big Victorian money pit, and now you rent and have freedom. I have a World War I-era money pit of my own. That’s money that I could have put toward something more fun, but instead, I had to keep my house from falling apart.
It’s a labor of love though, I know.
It is. Yeah. So, what about overspending amongst Americans? What are we regretting there?
Overspending was another category that accounted for a large share of regrets. One-fourth of Americans regret overspending on entertainment last year; 14% regretted overspending on travel’ 13%, overspending on housing costs. So that’s you, Sara?
And 12% regret overspending on an event like a wedding or a celebration of some kind.
The question is, do they regret overspending on their own wedding or attending someone else’s? The survey didn’t ask that.
That would be an interesting one to ask, for sure.
That could be a future question we ask.
Because it’s really expensive to attend other people’s weddings, too. What advice do you have to make sure that these kinds of regrets don’t repeat themselves in 2025?
When it comes to the spending, particularly, there are a few different approaches you can try. I think the classic advice for overspending on specific categories is setting a budget limit for that category. “Maybe I can spend $100 weekly or bi-weekly on entertainment,” and by bi-weekly, I mean every two weeks. Another way to approach it is limiting the number of outings. If your entertainment budget is getting blown because you like to dine out five nights a week, cut it down to three, or maybe only spend on the problem category on weekends or something like that. The idea with all of these is that you’re setting up guidelines and boundaries for yourself.
I do that with dining out. Me a number of years ago was still buying lunch outside of the house and getting takeout for dinner, going out to eat more often than I do now. I think back on how much that cost me over a five-year period, and it’s wild. And now it costs so much more to dine out. I feel like you go out for a burrito, and you end up spending $20.
Right? Well, moving from the rural Midwest back to a fairly urban place in North Carolina, my spending on dining out kind of went out of control for the first few months because I was just in heaven with all of the takeout. I’ve had to rein that in and really set those guardrails for myself and limit myself so I don’t just go nuts.
For me, cook on weekdays, takeout on weekends.
One other thing I see from the survey is that another regret that we have, in spades, has to do with credit scores. So let me guess. They are not high enough? Because I can’t imagine regretting having a perfect credit score.
Right. I wish we could parse this data by credit score because I am sure there’s some perfectionists out there who regret not making it to 850 from 825, which, by the way, is still very, very good. We know that 21% of Americans, so about one in five, regret not improving their credit in 2024.
Confidential out there for people who have an 825 credit score: You don’t have to do 850. It’s okay. You can stop.
Right. You’re doing great.
You’re doing great. Celebrate it. Enjoy it. So let’s ask for this one as well. What’s some simple advice to make sure that this regret doesn’t repeat itself this year?
I think the best advice or the best way to boil down advice about maintaining your credit or improving it is just being consistent. Consistently making your payments on time every month, and consistently keeping your credit utilization low. Improving your credit can take time, but if you can apply that consistency, you’re taking the right steps. When it comes to credit utilization, there’s really no hard and fast rule, but using no more than 30% of your available credit is a good level to aim for — and less is even better.
Something I always tell people who are struggling to remember when those credit card bills are coming, you can do a couple things. You can set up alerts through your credit card account. Just log in online or log in on the app, and it can text you or email you when your due date’s coming up. You could even set up auto-pay, even if it’s just a minimum amount, so you’re making that minimum payment, you’re making that payment on time, and then you can go in and manually pay more. Or if you have the money in your bank account, go ahead and just pay your entire bill. Even better, stay out of credit card debt because that’s a huge regret. It just really automates and takes things out of your mind.
I’m a huge fan of doing that because people are busy, and you just forget when stuff is due. So set up those alerts, make those auto payments. And also, pay your other bills on time, like your cell phone bill, rent, utilities, because there are times that those are reported to credit bureaus, too. So you want to be on time for everything, not just your credit card bill.
Great advice. Up next, we are going to talk about some money resolutions that you might want to implement to try and avoid financial regrets this year. That’s coming up in a moment. Stay with us.
Elizabeth Renter, here we are at the start of a new year. And I don’t know about you, but I hate New Year’s resolutions. I do, because it’s just something that’s going to end up with me being disappointed in myself for not following through in about three months’ time. So I think I remember at this time last year, you were saying the same thing on this very show.
You’re absolutely right. We had a very similar discussion last year, and the hype around New Year’s resolutions is real. I agree that they’re way overrated. I’m sure there are people who have great success with this annual approach to goal-setting, but I’m with you, Sara. I’d rather make lifestyle changes or goals throughout the year without all the fanfare.
Yeah, I’m sort of a week-by-week kind of person.
Hey, I’m here for daily goals, too.
I lift weights, and I tell myself, “Okay, just do it three times this week.” And some weeks it happens, and I’m proud of myself. And some weeks things get in the way — work is too busy, I get sick, I hurt myself so I have to scale back, something like that. Lower back pain is real at my age. If I take it week by week instead of for the entire year, I can account for all the things that happen on a regular basis that sometimes can get in the way of meeting your goal, and be forgiving of myself when that does happen.
Yes. I think that the annual approach is very all-or-nothing, and it’s easier to give up when you screw up a little bit, but I like that weekly approach because you can just pick it back up next week.
So how about we frame this as just some really smart stuff that folks can do to help themselves financially over the course of the year? You’re not promising that you’ll do it, but you’re going to work toward these goals. Week by week, minute by minute, hour by hour, whatever. Let’s start again with saving. What are some top tips that you have for people who want to stuff their savings accounts this year?
Well, this is kind of related to what you were saying earlier about automating credit card payments. One thing that’s really worked for me personally is automating transfers into my savings account. So twice a month, immediately after payday, a transfer goes from my checking account into a savings account. Automating that even a little bit makes it so much easier. You just don’t even have to think about it. You don’t have to remember.
But if you’re like, “Well, okay. But how do I find the money to save?” you might try swapping out one thing that you’re spending money on monthly and directing that money into your savings instead. Maybe that’s a streaming account that you signed up for and forgot about or are no longer watching your favorite show on, or a subscription box that has lost its novelty. Cancel that and direct the $20 or $60 or whatever it is into your savings every month instead.
I definitely do this with some of my savings goals. I have automatic transfers from my checking account into my general savings account. I also do automatic transfers into an account that I earmark toward mortgage payments, another one toward daycare payments. That way, I know that the money’s going where it needs to go. And whatever’s left in my checking account, I can spend. Hopefully, there’s a lot left, but sometimes it’s a busy month.
Listeners, if you are saving toward any sort of specific goal — who isn’t, really? — NerdWallet has a free savings calculator that will help you understand how your money can grow over time. You plug in your starting balance and your contribution amount and the annual interest rate on your account and how much time you plan to spend saving, and it’ll show you your total balance at the end of your saving journey, which can be really helpful in motivating you to hit that goal. I love a good calculator. They’re like my bread and butter. If you love a good calculator, too, we will link to that in the show notes, or you could search online for “NerdWallet savings calculator.”
Let’s turn back. Let’s flip that coin back over to spending. We’ve already talked about savings again. We shared a bit earlier on how not to overspend, but what are some other tips and tricks that you have for making sure we’re spending wisely throughout the year?
Spending wisely is spending with some thought and attention. Slowing down and being mindful of your actions is really where you can make a difference, whether you filled your cart at an online retailer and enforce a holding period before you hit that checkout button or if you’re just more strategic and thoughtful about your shopping trips ahead of time. The more you can think about your spending, the more you can make those small changes that add up over time.
I really think that one common way people end up spending more than they think they’re spending is because they use credit cards, and it’s so easy to put everything on your card. And then all of a sudden, you see your bill and you have that momentary freak-out where you just racked up all of these purchases. You don’t even remember half of them. Now you have to pay them off, and it’s the worst.
So obviously, a key thing to do here is budget for these kinds of costs, but what sorts of mental tips can people use to check in with themselves — not just when the bill comes, but throughout the month when they’re reaching into their wallets and taking out a credit card?
That holding period I mentioned is really helpful if you find yourself using your card at online retailers. When those retailers have your card info stored, it’s even easier to spend, and making yourself wait a while before you actually make the purchase can help.
And on that note, if you can opt to not save your credit card info on those sites you frequently visit, that can make a big difference, too. If you have to go get your card from the other room every time you want to transact, it forces that slowdown period. Remember when a shopping spree meant contending with other shoppers and finding parking? Well, one reason we did it less often was because it wasn’t so easy. So make your credit card transactions just a bit more difficult.
You can also optimize the spending you are doing by choosing the right card. If you’re going to use a credit card, make sure the things that you’re buying can be paid off with each billing cycle and use a card that offers rewards like cash back.
I hate circling for parking. That’s one of my driving pet peeves.
Yeah, but now I don’t have to do that. I can sit on my couch with my phone and spend my money, and it’s a blessing and a curse.
Yeah. Let’s wrap up with some final ideas for having a happy and financially healthy 2025. So what have we missed?
If you have a very specific financial goal for the year, I’d recommend checking out the content over at NerdWallet. And this isn’t just a shameless plug. I do it all the time. That savings calculator you mentioned earlier — I just used it last week to compare some rates that I was getting paid on various savings accounts. So, the content at NerdWallet — I can give you a few of my favorite tips on this podcast, but if you’re looking for very specific pointers on a very specific financial goal, you can find it there.
My ethos personally for money (and more, really) is to consistently try to do better and to give myself grace. I’d suggest that as a sort of all-encompassing approach to a financially healthy 2025. So wherever you are on your personal finance journey, make decisions and take steps to do a little better than you did before. Sometimes, you’ll be able to take big steps and grow, like by opening a CD with your tax refund, for example. But some days, just saving a couple dollars on your grocery bill will be the extent of your progress — and that’s okay.
And when you meet setbacks or unexpected expenses (because you will), be nice to yourself and just keep moving.
Take it minute by minute. It’s okay. It doesn’t have to be all year, and not every decision you make is going to be perfect.
Every day is a learning opportunity when it comes to your money. NerdWallet Senior Economist Elizabeth Renter, thanks for stopping by. You can leave the New Year’s confetti and noisemakers at the door. I’m going to save those for later just for fun.
All right, Sara. Thanks for having me.
Sara, I love how you and Elizabeth just keep it real. We have been anti-resolutions for a little while now on Smart Money because, as you two discussed, resolutions can lead to unnecessary disappointment and unrealistic expectations. We’re not saying don’t aim for the stars, because I am certainly fueling up my rocketship for all I want to achieve this year, but if your plans don’t go exactly as mapped out, that’s fine. Just do your best.
And as always, give yourself some flexibility, and it’s totally okay for your goals to change mid-year.
I’ll say again that it’s always helpful to go back and review what went well and what didn’t for any given timeframe. It doesn’t have to be year-to-year. It can be whatever works for you. Having that perspective can be really useful as you move forward in your financial life.
And that goes for every aspect of it — from budgeting to credit to housing to careers to investing.
Nice tee-up, Sara, because we’ll be getting to all of those topics as the month goes on. Next week, we’ll have some advice for those of you who are looking to get more informed about investing.
I do believe that people should generally build a safe and boring portfolio of index funds first, and then they can speculate with whatever money they’ve got left over. And I’m practicing what I preach there.
For now, that’s all we have for this episode. Do you have a money question of your own? Turn to the Nerds and call or text us your questions at 901-730-6373. That’s 901-730-N-E-R-D. You could also email us at [email protected]. And remember, you can follow the show on your favorite podcast app, including Spotify, Apple Podcasts, and iHeartRadio, to automatically download new episodes.
This episode was produced by Tess Vigeland. I helped with editing. Amanda Derengowski helped with fact-checking. Megan Maurer mixed our audio. And a big thank you to NerdWallet’s editors for all their help.
And here’s our brief disclaimer: We are not financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes and may not apply to your specific circumstances.
And with that said, until next time, turn to the Nerds.
