Those few days after the festive season are dangerous, right?
Payday seems to be about a hundred years away. Meanwhile, the last of the leftovers means you’re going to have to do a big food shop before someone eats the Christmas tree. And that’s when you start worrying about money…
With the New Year here, let’s take a look at what should be at the top of your financial to-do list.
Maintain a budget
Without a budget, it’s just not possible to stay on top of your money. You’ll have a much better idea of what you’ve got, what you need – and whether you can spend a little extra on yourself in the New Year sales.
Getting hold of a budget is simple: You can either create your own one in a spreadsheet (it’s pretty easy), or find one online. Just make sure you keep a rigorous schedule of checking and updating all your incomings and outgoings.
Check your credit score
Whether 2018 will see you thinking about bigger purchases like a holiday or a car, or you’re just determined to keep control of your finances, then it’s worth checking out your credit score. You can apply for this online, and Money Saving Expert’s free credit checker is worth looking into.
Your credit score is essentially your on-paper profile; how lenders see you. What’s great about your credit score is, it’s not static. It fluctuates, so if you’ve been paying off credit cards on time, or you’ve fallen behind on your phone bill, the score adjusts. Once you know your credit score, you’ll be able work out where you need to improve to get a better credit rating.
Brush up on your financial knowledge
The world of finance can be a confusing minefield (and it can feel as if they designed it that way on purpose). There’s ISAs and shares and APR and… Ok, you probably already know the basics, but this year, do even more research.
Finance is constantly shifting, from new rules regulating borrowing to different savings accounts. So even a fleeting look at the money news when you’re checking the headlines in the morning is better than putting your money in the wrong sort of savings account or losing out on a great interest rate offer. The more educated on the subject you are, the more in control you’ll feel.
Work out where your money’s really going
Ok, so you’ve already got a budget. You fill it in religiously. You know exactly what you’re going to spend over the month – but how does that stack up with what you actually spent? Get yourself a money manager app and you’ll be able to see what your spending habits are really like.
You can get these apps on your smartphone. Your bank may already offer this service, but if not, choose a reputable one like Mint. These apps connect with your bank and analyse your spending, letting you know, for instance, you spent 30% of your money on food or 10% on clothes. Fantastic insights, then, that keep you fully informed of your spending. Of course, if you mostly use cash over card, the insights will be limited.
Saving isn’t easy. You might be too short on cash to afford locking some away in an account; you may be tempted by the latest must-have buy; you might have low interest rates and therefore zero incentive to do it. Whatever it is, committing to a saving schedule can be a drag – even when we know how important it is (and how handy that money will be later down the line).
Think how easy it would be if you had someone helping out. So, this year, why not pair up with another saver – a friend, a relative, someone you trust. Now you’ll both have someone to talk to about what you’re putting away, and what you hope to achieve. Even better, you’ll both have each other to help stay committed to savings.