“Remember that small steps can create giant leaps over time, so never think of any financial or spending matter as a small one.” (David Bach)
The start of a new year is always a good time to take stock. So why not give your finances a check as a new year’s present to your future self?
Putting yourself on a better financial footing doesn’t require big actions and huge amounts of time. Just a few simple things can make a big difference
Here are four ideas to start your year on the right financial footing.
1.Review how you spent your money in 2022
Take a look at your bank statements and see how you feel about where your money went last year. Does anything stand out? Are there any obvious places where you feel straight away that you’ve spent too much?
Changing your spending habits starts with being conscious of where your money is actually going and what’s important to you. If you’re spending too much on things that don’t make your life better, make a commitment to change that.
2. Do you have a backup plan?
If something were to go badly wrong, would you be able to survive financially? If you lost your job, had a debilitating accident or fell terribly ill, do you have an emergency fund and enough insurance to cover you?
No one likes to think about these possibilities but take some time to think about what you would need in a situation like this and what cover you currently have. If something did go wrong, you’ll be extremely grateful that you had a backup plan in place.
3. Check your debt and your credit status
With the cost of living rising, it can become difficult to meet your monthly expenses. Unfortunately, this means many people take on more debt.
The start of a new year is a good time to review how much debt you have, how much it is costing you to pay off every month, and whether you are taking on more than you can manage. The credit bureaux also allow anyone to get one free credit check every year. Visit one of their websites and check your score to see where you stand
4. Set up debit orders for your savings and investments
The best way to make sure you are consistently growing your wealth is to make monthly contributions into your savings and investment accounts. And if you haven’t done so already, it’s best to automate this so that the money goes out of your account before you’ve even noticed it’s there.
Essentially, you are paying your future self. Don’t let your current self be tempted into thinking that they could spend this money instead. If you never see the money in your account, you’ll never miss it. And your future self will thank you.
To discuss your financial situation, speak to a professional.
Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.