Will Your Year-end Money Audit Put You On The Naughty Or Nice List?

Do you know which of your financial habits deserve coal, and which earn the nod of approval? With a fresh year ahead, now is the perfect time for a frank money audit, Santa style. How many of these naughty habits are you guilty of? Here are tips to help you decide how best to adjust them and start 2026 that much smarter.

Buy now, pain later

Buy now, pay later (BNPL) options can make large or impulsive purchases feel painless in the moment but they can blur the line between affordability and convenience. When multiple instalment plans overlap, they can strain your budget and increase the risk of missed payments or fees, especially if you relied on BNPL to do your holiday shopping .

To move away from this coal-worthy habit, start by pausing new BNPL purchases and reviewing any active plans. If payments remain, make sure they are fully accounted for in your monthly budget so there are no surprises. Going forward, reserve BNPL plans for planned purchases you could otherwise afford, rather than using them to stretch your budget.

Another effective way to break the BNPL habit is to automate key spending decisions. Automatic transfers to savings, pre-authorized bill payments and scheduled debt payments reduce your reliance on willpower and help ensure your essential expenses are covered first.

Impulse food spending

The holidays and any times when routines are disrupted can lead to spending that no longer aligns with our values or budget. Justifying extra spending with “just this once” often turns into a habit that lingers well into the new year. This can create stress long after the celebrations end, making it harder to regain financial balance.

To move this habit off the naughty list, set clear spending limits in your budget for convenience items such as takeout, snacks on the go or the occasional drink with friends. There is no need to go cold turkey, though. Allowing for a planned treat can serve as a meaningful reward for staying on track the rest of the week.

You can also adjust your grocery list to include items that make it easy to prepare the foods and drinks you are most likely to buy on the run. Spending with intention and planning ahead adds structure to your finances, reduces feelings of restriction and supports more sustainable money habits over time.

Paying only the minimum on credit cards

Minimum payments are designed to satisfy the basic terms of your cardholder agreement, but they significantly extend repayment timelines and increase the total amount of interest you pay. Over time, this frosty habit can quietly drain tens of thousands of dollars from your budget.

To let go of this habit, aim to increase your credit card payments above the minimum whenever possible. Start by setting fixed monthly payments for each card based on what your budget can realistically support. You can further accelerate progress by adding extra payments each time you are paid. Even small, consistent increases can make a meaningful difference in reducing the overall cost of the debt.

Structured repayment strategies such as the snowball method (paying off smaller balances first) or the avalanche method (targeting the highest interest rates first) can also be highly effective. Whichever approach you choose, having a clear plan builds momentum and boosts your confidence. Track your progress and acknowledge milestones along the way to reinforce positive habits and keep motivation high.

If credit card debt feels overwhelming, consider reaching out to a non-profit credit counselling agency in your community. They can provide impartial guidance and practical tools to help you regain control and pay down debt more efficiently.

Choosing to live pay cheque to pay cheque

During periods of economic uncertainty, it is common for every dollar of income to be spoken for. When that happens, even minor disruptions can create financial strain. While this may be unavoidable during certain times, staying in this pattern without a plan to create change increases vulnerability and can limit future opportunities.

To move away from the habit of living pay cheque to pay cheque , start by looking for small but meaningful ways to create breathing room in your budget. This could include cancelling underused subscriptions, reviewing your internet or mobile plans, becoming a no- or one-vehicle household, or exploring modest ways to increase income, such as renting out unused garage space or taking in a student.

Any savings, additional income or unexpected windfalls can then be directed toward building an emergency fund and reducing debt . This two-pronged approach adds flexibility, helps protect long-term goals and can go a long way toward restoring financial confidence and peace of mind.

Avoiding financial conversations

Many Canadians delay reviewing their finances or talking about money with a spouse out of discomfort or fear of what they might uncover. Others postpone decisions until a crisis forces action or they assume that things will work themselves out without a clear plan. This kind of avoidance allows small issues to grow into larger problems.

To step in from the cold, schedule regular, low-pressure financial check-ins . If you manage your finances on your own, aim for a quarterly review. If you share finances with a partner, a brief monthly check-in can help keep everyone aligned.

Keep the process focused during a pre-determined timeframe and concentrate on facts rather than blame or regret. Reviewing goals, tracking progress and making adjustments leads to better decisions, fewer surprises and financial challenges that are easier to manage when they arise.

If you’re ready to set aside the financial habits that keep delivering lumps of coal, focus on what to do differently. Start small, choose one naughty habit at a time to replace with a nice one, and those steady improvements can help make the year ahead more stable, and a whole lot merrier and brighter.

• What happens when going bankrupt is not an option?
• BNPL: Buy now, pain later? How to avoid the sting of delayed payments from Black Friday and holiday shopping

Mary Castillo is a Saskatoon-based credit counsellor at Credit Counselling Society, a non-profit organization that has helped Canadians manage debt since 1996.