Five simple ways to reset your finances in 2026

It’s January, the excesses of the festive season are behind us, and with a long wait until payday, you may be vowing to turn over a new leaf with your finances. But where to start?

Finding the headspace to make smart choices with your money is tough enough at the best of times. The rising cost of living, tax changes at the Budget and concerns about how AI could affect our future job prospects have made it harder still.

As you contemplate what the year ahead could bring, here are five simple ways to reset your finances for 2026.

Forget resolutions — set an intention 

Don’t overwhelm yourself with a list of goals you want to achieve in the year ahead. Think instead about setting a financial intention. 

This could be something as simple as “I want to be more aware of what I’m spending” or “I want to learn more about investing this year”, says Catherine Morgan, the financial coach behind the podcast It’s Not About the Money.

“Creating an intention comes from a place of vision rather than a place of fear, because it doesn’t depend on getting everything ‘right’ or hitting a specific target,” she says. Holding this intention should encourage consistent, small actions with no fixed timeframe — so you’re less likely to fail and give up, and it’s more likely to lead to lasting changes.

Don’t know which intention to set? On the new year episode of the Mel Robbins podcast, the US author and lifestyle guru suggests looking back on everything that happened in 2025 by scrolling through the camera roll on your smartphone.

What were the high points and low points — and what can you learn from both? Then, thinking about the year ahead, what would you like to do more of — and less of? Bringing this back to a financial context, thinking about how we want to spend our time is a very useful way of prioritising how we might spend our money.

Seek clarity 

“Most new clients I speak to don’t know what they actually have,” says Chris Exley, the financial planner behind the popular MoneyGeek Instagram account. “The classic one is pensions — what do you have, and where are they? If you’re a homeowner, how much is your property worth — and what’s the outstanding balance of your mortgage? What have you got in cash savings, investments and how much do you owe on credit cards?”

Gaining clarity about where you stand financially will help you to set intentions and make better informed decisions in the year ahead.

Many people are eager to get into investing. The introduction of targeted support in the spring will make this easier for those who have previously been priced out of obtaining financial advice. From April, some banks, investment platforms and pension providers are set to become suddenly more helpful, providing nudges and insights to the investment curious. However, Exley advises against rushing in.

In his experience, most people also have no idea how much they spend, or what their fixed costs are. “Before you even think about investing, financial planners typically say pay down short-term debts and have three to six months of cash in an emergency fund, but that should be based on your day-to-day spending rather than your entire monthly income,” he says.

If you’re in a long-term relationship, you could complete this exercise together. Single? Having a trusted “money buddy” in a similar financial position to compare notes with means you can support and motivate each other. Setting an intention to check in regularly with each other and make time to talk about money would be a wise investment.

Use AI as a ‘financial therapist’

Artificial intelligence could help you explore your emotional relationship with money — a vital step towards understanding the underlying beliefs and triggers that invisibly influence our financial choices, and how we could change these patterns in the coming year.

Morgan is not surprised that millions of people are turning to generative AI as a therapist. “AI can help people explore their emotional relationship with money in a way that feels safe,” she says. “Many of us avoid looking at our finances because it triggers uncomfortable feelings — shame, anxiety, feeling overwhelmed. AI removes some of that charge, making it easier to start the conversation.”

If you want to involve AI in money conversations this year, note that the real skill lies in the prompting: “Be specific about the feelings that come up around money, not just the practical challenges. Feed it information about the fears and worries you have and allow it to help you understand the patterns beneath your money behaviours.”

Morgan finds Claude and ChatGPT are best for brainstorming and dialogue, but stresses that you should use generic prompts without sharing your personal details. (She also recommends using the audio function to talk, rather than type, your answers to make the process more fluid.)

For example, we asked Claude to suggest financial tips for a 44-year-old woman, with two children, who earns £150,000 a year, resists budget planners and tends to overspend, but is married to a man who loves to save. “Can you suggest ways for me and my partner to work together rather than argue about money?”

In response, it asked for more information on those spending patterns — is the overspending down to spontaneous treats, lifestyle creep or something else? What’s happening emotionally just before or during the spending?

What this dialogue explores is not the numbers, but the feelings driving the money behaviours. Claude asks more questions about the couple’s disputes over money. What are the conversations that lead to arguments typically about, and who initiates them? And what might you appreciate about your partner’s approach to money, even if it frustrates you?

Morgan suggests using AI to explore your own relationship with money before having a conversation with your partner (or indeed, a financial planner). Having identified the “what” with money, the next step is the “how” and what plans you might put in place.

As with any online research about personal finance, there’s no guarantee AI is correct, especially in crucial areas, for example tax. Never upload personal data such as bank statements to cloud-based AI services; anonymise data and remove names and account numbers first.

Morgan rates Google Gemini as the best for creating and personalising financial spreadsheets which can be used to track income and spending, or to model investment assumptions such as how a retirement pot could grow if you changed key variables. “For many people, traditional budget spreadsheets trigger shame or restriction. But when you can customise something that feels supportive rather than punishing, you’re much more likely to actually use it.”

For those worried about the impact AI could have on their future employment prospects, feeling the benefit of using tools like this in your personal life could have read-across for your professional life. If your organisation offers staff training in AI, sign up. Morgan suggests courses on how better to prompt AI are a good place to start, noting the growing number of AI qualifications that financial professionals can already pursue.

Don’t gift money in a hurry

Changes next year that will see inheritance tax applied to pensions, plus a growing sense of unease about future Labour budgets, have focused minds on lifetime gifting and legacy planning.

“Clarity first, generosity next,” is the mantra that Charlotte Ransom, founder of digital wealth manager Netwealth, has been preaching. “Our advisers have never been busier, and clients are seeking advice at younger ages,” she says, adding that 50 is now the average. “People are clearly concerned about IHT and taxes overall and want to start gifting so they can get the seven-year clock ticking, but it’s important not to rush.”

Netwealth offers clients the ability to bolt-on sessions with its team of chartered financial planners for a fixed hourly fee. A common request is understanding what impact their own longevity could have on their overall retirement pot, such as living to 95 instead of 85. How would the value of any gifts they make now impact the level of future income they could draw down? Other variables that families commonly want to explore include whether couples might downsize from the main family home and, crucially, when; how much longer they might continue working; and modelling the impact of sustained higher inflation.

Having spent time exploring what their own needs are likely to be, families can start to bring in a gifting schedule with what’s left beyond this. The intergenerational nature of this process requires open and honest conversations about money, says Morgan, noting the need for a collective rather than individual approach.

“Take time to explore this and build a vision,” she advises. “What do we see as being possible for us in 2026 and how can we achieve this together? These could be questions you’ve never asked yourselves before.”

Get mortgage ready

This year is going to be a big year for the mortgage market. A loosening of regulatory restrictions will make it easier for first-time buyers, the self- employed and pensioners to access more flexible home loans, unlocking all kinds of new financial possibilities. And for 1.8mn UK households who are rolling off fixed-rate deals, December’s interest rate cut from the Bank of England was welcome news.

Five years ago, mortgage interest rates had reached their pandemic nadir — often below 2 per cent — meaning payment shock beckons for many. The best five-year fix on the market is currently 3.75 per cent. Getting ahead of the curve and starting to look for a new deal at least six months before your rate expires will stand you in good stead.

Exley’s own mortgage fix is coming to an end, but based on current interest rates, he has already used a mortgage calculator to figure out what his future level of monthly payments might be.

However, those coming off a two-year fix should be able to secure a reduction in their monthly repayments — especially if the mortgage price war accelerates in 2026. Overpaying your mortgage by agreeing a new deal, but keeping your monthly repayments at the higher level could be a smart way of clearing your debt sooner. Again, a mortgage calculator could help you model this.

Exley also advises looking at your loan to value ratio (LTV). These tend to move in 5 percentage point brackets, with mortgage lenders offering lower interest rates to those who fall beneath an LTV threshold. “If you’re very close to one of these thresholds, it could be worth using excess cash savings to access a cheaper rate,” he says, noting that a good mortgage broker will help weigh up the options.

The other variable is the value of your property — especially if you have extended or carried out other work that could have increased this.

“On product transfers [where you stay with the same lender and agree a new fix] they will often use an indexed valuation — you paid this much five years ago, since when the average house price index has increased by X per cent,” he explains. “If you’re close to a threshold, asking for a revaluation could benefit you — but again, a mortgage broker can help you navigate this.”

Claer Barrett is the FT’s consumer editor; claer.barrett@ft.com Instagram @ClaerB