For many of us, financial housekeeping feels much like regular housekeeping – necessary but not very interesting. However, if you want to have some freedom in terms of how you live your life then a sound financial basis is key. Whether you’ve just left home or you’re looking to give your finances a spring clean, these tips will help you to get your money matters in order.
Learn to save
It’s not rocket science but saving is one of the most fundamental skills for good financial housekeeping because then you don't need to borrow money. Savings can be used to pay for key life events like weddings, children or even setting up your own business, and they provide a buffer against unexpected bills and costs. Get into the habit of tucking away some cash every month so that it becomes something you do without thinking. Make use of tax-free savings options, such as ISAs, to maximise the money you put aside.
Attitudes to money can define how much we have or don’t have – as well as whether we enjoy it. Take a lesson from billionaire Warren Buffet and keep things simple – Buffet still lives in a house he bought in 1957 for $31,500. You don’t need to expand your spending as your income grows; work out what makes you happy and be comfortable but don’t spend for spending’s sake.
Keep track of the paperwork
Good financial housekeeping succeeds if you’re organised. A home filing system means that you can always find the paperwork you need. Whether that filing system is entirely online/in an app – or ‘In Real Life’ – just make sure that you have one place where you keep everything, from direct debit mandates, to receipts, so that you can stay on top of your spending and financial commitments.
Be a budget bore
No, budgeting is not interesting – but the things you can do with the money you’re managing well certainly are. Budgeting is just the process of looking at your income and expenses, working out how to use one to cover the other and identifying the extra you might have. They say knowledge is power and when it comes to your finances it’s budgeting that gives you the insight you need to be powerfully organised. Set a time to do a budget each month and once you’ve created it then stick to it.
Stay on top of your finances
Interest rates change, prices rise and terms and conditions are often amended – when it comes to finance it really pays to be continuously monitoring them. Task yourself with regularly checking how much you’re paying for personal loans – whether guarantor loans or payday loans – and move debt if you’re not getting the best deal. Make sure you’re aware of any new bank or financial charges that apply to you, increases in utilities costs, opportunities for investment. The more on top of this fluid situation you are, the easier it will be to respond to change and maximise your money.