Want to get on top of managing your money – we’ve got some tips which could help you out...
Whether you’re new to managing your money or a seasoned pro and paying your own bills, getting to grips with your finances can be a daunting task. But familiarising yourself with what’s coming in and out of your bank account on a regular basis - and where it’s going - is one of the best ways to see where you can save some cash.
Here are our top tips for getting a better understanding of your finances.
Denial is not your friend when it comes to managing your money. It’s important to have a full and accurate picture of your spending habits. Start by writing down all your set monthly outgoings, like your rent or mortgage, utilities and phone bill, to the penny where possible.
Next, have a look at your day-to-day spending. A good way to get an accurate insight is to write down everything you spend over a week or month – and we mean everything no matter how small. Seeing things written down in black and white makes it easier to see where cuts could be made.
Tackling all of your finances in one go is a tall order, so once you’ve got a full picture of your spending, break it down into categories like bills, food, everyday expenses and treats and focus on one at a time. If you can make small changes in each category they’ll soon add up!
If you’ve got bills stuffed in every drawer and never open your bank statement then it’s time to inject a bit of organisation into your finances. Dedicate a folder or box to all your money-related papers so you can get your hands on them easily.
It’s also worth buying a calendar or diary and noting down when your utilities deals come to an end, when your phone contract is up etc. That way you can start searching for a new deal in good time and avoid rolling on to a pricier rate.
Technology is your friend when it comes to getting your finances organised. If your bills aren’t all on direct debit, set reminders on your phone to ensure you aren’t charged for late payments.
The more organised your finances are, the easier it is to keep on top of them.
Hopefully after the first few steps you have a good idea of where your finances are right now, so it’s a good time to start thinking about what you’d like them to look like in a few months or a year’s time. Maybe you’d like to be able to save a few pounds every month or pay a bit extra off your credit card? Or maybe you’d like to cut the amount you spend on food each month? It’s unlikely you’ll be able to revamp all of your finances overnight, so focusing on identifying something that’s important to you, and realistic to achieve, gives you the best chance of making some changes.
Your financial situation is constantly changing. Even if your income stays the same, the cost of living rises and your family’s needs can shift, so it’s important to keep reassessing your situation on a regular basis. Set a night aside once every couple of months to look things over and make sure everything is shipshape.