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Employee Wellbeing - Why it's key to keep an eye on finances
When the temperature starts to rise and the days lengthen, spring is clearly upon us. For many people, the changes of the season, from Winter to Spring, inspires them to declutter and spring clean their homes in preparation for the warm, sunny months ahead.
Published on 22nd May 2023
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4 min read
This year why not also take the opportunity to give your finances a thorough dusting down, to ensure they are also in good shape for the warmer months ahead?
Here are a few tips to help you do it:
1. Set financial goals
Setting financial goals is a key step to organising your finances as they can help you to stay organised and motivated to reach them.
Do you simply want to spend less than you earn, reduce debt or save for something special? Once you’ve worked out what your financial goals are, create a plan for how you will reach them and work out the smaller things you can do each day to get there.
Small changes can soon add up. For example, cutting back on one shop-bought cup of coffee a day could save you over £1,000 towards an emergency fund. Choosing to put an extra few pounds into your ISA each month, could be the difference between having enough saved for the next holiday, or not. Saving a little more into pension now could mean you’re able to retire earlier or have a larger income in the future.
Breaking down your financial goals into short, medium and long-term goals and putting aside small, manageable monthly amounts for each will seem less daunting and far less achievable. Remember that achieving what you want in life is usually more of a marathon than a sprint. So keep going, celebrate your wins and don’t give up if you sometimes go off track!
2. Review your spending
Our spending habits often creep up on us. Whether it is that we always tend to shop at the same stores, stay loyal to certain companies or continue to pay for things we don’t use, such as subscriptions.
Take stock and see where savings can be made and identify where money is being spent that you don’t need to spend. So, look at your bank statement from the last year and work out where your money goes each month and those areas you could make savings.
Making a weekly food plan or cutting back on one food delivery each month can help you save an average of 20% on your food bill. Also, check out online discount sites to see what you could save without changing what you buy. It’s only by knowing how and where we spend our money that we can start to take control of our spending. Take a look at our Money Saving Tips for ideas as to how to reduce that monthly spend.
3. Deal with debt
Dealing with debt can sometimes seem uncomfortable. If you have spare money after your essential bills have gone out, try to pay off more towards your debt, as doing so will save you money in the long run and clear your debt more quickly. Paying just a little above the minimum payment required can save you a huge amount in interest payments.
Always ensure you make debt repayments on time to avoid additional charges, and shop around to see if you can get better credit card, loan, and mortgage interest rates, to reduce your cost.
Whilst credit can seem like a great way to have what you want or need now, you always have to be able to afford to repay it.
Debt is a major cause of stress and anxiety for some people. If you are struggling with debt, please do not ignore it as it won’t just disappear. Speak with your lenders, who may be able to provide help and advice, or contact one of the many free sources of debt advice and support.
Taking control of our finances helps us to build money confidence and can have a significant positive impact on our personal well-being and sense of security. So why wait?
