Remember how optimistic you felt on January 1? It was going to be the best year so far! Now that we’re halfway through 2026, take a moment to compare your progress to your New Year’s resolutions. Are your spending and savings goals still on track? If you’re unsure, this is a perfect time to review the income and expense items below to ensure your financial plan is headed in the right direction.
Savings
If your goal was to max out your retirement savings contributions, you should have at least half of the full contributions made. Take a moment to log in to your accounts (or check your pay stub) to see your year-to-date contributions. If you have a 401(k) or 403(b), your full 2026 contribution would be $24,500. If you are under age 50, you should have already contributed $12,250 by mid-year. Those 50 and older can add an $8,000 catch-up ($4,000 by July 1), and workers ages 60–63 get an enhanced $11,250 catch-up ($5,625 by July 1). The Traditional and Roth IRA limit for 2026 is $7,500 ($3,750 by July 1), with a $1,100 catch-up for those 50 and older (extra $550 mid-year). If you have access to a health savings plan, your maximum contribution is $4,400 for a self-only plan, and $8,750 for family coverage, both with a $1,000 catch-up available at age 55. So if you are contributing periodically, by mid-year your contributions would be $2,200 for self-only, $4,375 for family, and an extra $500 for those over age 55.
Income
W2 Employees: The Bureau of Labor Statistics reported that private-sector workers saw average wages and salaries increase 3.4% for the 12 months ending in March 2026, compared to 3.5% for state and local government workers. Meanwhile, a Bank of America study found that workers who switched jobs in January 2026 saw a median pay increase of around 4%, compared to 3.5% for those who stayed put. The job-switching premium is much lower this year than the 2022 high, when nearly half of all workers saw a pay increase of 11% or more by parting ways with their old employer. With switching no longer the guaranteed pay lever it once was, weigh the benefits of staying loyal to your current employer with your income needs.
Self-Employed: While most W-2 workers can quickly review a pay stub to determine periodic net pay, self-employed workers may have variable income. If you are a small business owner or 1099 employee, track your expenses and projected earnings closely to determine estimated revenue. Don’t be afraid to raise prices as your costs of goods and services rise.
Retirees: Those who rely on Social Security for income saw a 2.8% cost-of-living adjustment (COLA) for 2026. Looking ahead, The Senior Citizens League now projects a 3.8% COLA for 2027, but the Social Security Administration will not make that announcement until later in the year. If you are taking distributions from your retirement portfolio, you may need to increase withdrawals, but be sure to consult with your investment professional to discuss any cash flow changes.
Expenses
The cost of goods was up 4.2% from May 2025 to May 2026 and although gas prices have eased in recent weeks, the renewed conflict in Iran could push pump prices back up quickly. The national average for regular gas is about $3.84 a gallon according to AAA, well below this year’s $4.56 peak on May 21, 2026, just before Memorial Day weekend.
Fixed-cost utilities such as cable, phone, internet, and garbage service may be under contract, but don’t be shocked if those costs go up at the annual renewal. Your Netflix and other media subscriptions, club memberships, child and pet care, and professional dues may all increase if they have not already. In addition, anyone who purchased a home three years ago with a 3/1 adjustable-rate mortgage, expecting rates would fall, and now facing a reset, should model the new payment. ARMs still typically offer a lower introductory rate than 30-year fixed loans, but that rate isn’t guaranteed to stay low.
Rising prices for variable-cost items like utilities (e.g., water, electricity, oil/gas), food, household supplies, transportation, property maintenance, and clothing might be even harder to notice unless tracked regularly.
If your budget is tight, review each expense in your spending plan and determine whether it is a need (mandatory/unavoidable) or a want (subject to choice/preference). While it is harder to reduce mandatory or non-discretionary expenses, most people have options with discretionary costs. However, the distinction between discretionary and non-discretionary is subjective. For instance, one may feel that three golf memberships are essential, while another might feel it’s time to surrender an infrequently used country club membership.
Next Steps
If you need to assess your spending patterns and modify habits, consider what lifestyle changes or payment terms you can make to adjust your spending. Clients of Hurlow Wealth Management Group have access to the CFO Center, their Personal Financial Website. By accessing it and linking their spending accounts, they can easily view their spending history and automatically track and manage their budget.
If you are not yet a client, feel free to schedule an introductory call with one of our financial advisors. For over two decades, the Hurlow Wealth Management Group has helped clients achieve their financial goals by creating clarity around priorities, feeling confident to make decisions, and ultimately achieving comfort. Schedule a time to have a conversation that can give you confidence that your entire financial plan is headed in the right direction.
