Confession time… I used to be rubbish with money. As soon as it came in, I spent it and I never saved for a rainy day, but in the last few years, I’ve realised this gung-ho attitude towards money won’t serve me well.
I’m not saying I’m Martin Lewis standard just yet, but I do have some savings – and yes, that includes an ISA – and I am starting to make a hole in the huge debt I managed to acquire when I was younger and credit card happy.
Hopefully some of these ideas will also inspire you to sort out your money in 2020.
Look at what you spend – and start cutting it out. Even if you can reduce your spending by just 1% a month, that will, over time, add up.
Last year I cut out unnecessary Amazon shopping – you know, when you go on the site and buy stuff you never knew you needed – and buying take-out coffee. By cutting out my twice-weekly trip to Costa, I saved myself a whopping £265!
Spending is so much more fun than saving, so if you need some motivation, try and make a game out of it. I love the app Moneybox, which rounds up your purchases to the nearest pound, putting the difference into an ISA. I managed to save nearly £2000 last year by doing this. Of course, you don’t need an app to do it – when I resist a spend, I now put that money into a big jar in our kitchen. Yes, we do dip into it, but it’s amazing what you have in there at the end of the year.
And that brings me to the one major tip that really helped me – take baby steps. My debt, though not huge, is still fairly big and at times the thought of ever paying it back was overwhelming, so I just paid the bare minimum and that was it. Once I realised it was never going away, I decided to pay extra – only 10% more each month – but it’s enough to help beat the interest and in fact, I’ve now paid one card off. Only another two to go…
Starting small also goes for savings. Whether it’s £3 or £30, just putting something away each week or month gets you into the habit of it. And let’s face it – none of us are going to choose saving over a gorgeous new pair of shoes, but just like going to the gym, once you start doing it, it will become second nature.
Obviously, it’s hard to save money if your monthly pay cheque is just going on bills, so that’s when you need to see if you can earn more – and it needn’t require a whole career change.
We all have skills – perhaps your particular skill is in demand? Fiverr for example allows people to sell skills such as graphic design, voice over and data entry. If you’re more on the crafty side, get making and sell your wares on Etsy. You can go more low-tech and advertise yourself in a local newsagent – dog walkers are always needed.
Then, take a look at what you have that you can sell. Don’t overlook anything! I had great success selling some of my son’s old McDonald toy figures – if someone is looking for them, they will sell. Don’t just try eBay either – DePop, Gumtree and MusicMagpie are all great sites to sell your bits and bobs. Remember – what is one person’s trash is another’s treasure!
I love writing, it’s my job. I don’t however like anything to do with numbers, especially any kind of sum. I do think though at some point everyone needs to write down their outgoings and incomings. I do mine on an Excel spreadsheet – because I am a bit of a geek and I love a spreadsheet – but you can do yours however floats your boat.
The main thing to concentrate on is what regular payments are going out and when, plus what income is available. I also have a separate sheet for all my debts. It’s very sobering when you see it written down, but it will help you see where you’re leaking money.
I go back and look at it once a month or so to ensure everything is up-to-date and to see how those debts are reducing, which gives me incentive to carry on.
A lot of what I was guilty of was unplanned – or unthinking – spending. That is splurging on nights out or new clothes without really thinking about it. Now, I go through each month and see what’s happening – whether it’s drinks with my mates or someone’s birthday – and I put money away for that. I have a Monzo account and they allow you to create ‘pots’ so you can put the money you need for these things to one side.
The same now goes for our weekly food shop – we meal plan so we know exactly what we need to buy as my husband got fed up of us throwing food away we never ate. I’m not saying you can never be spontaneous again, but by being more prepared, it allows that odd ‘Whoopsie, I seem to have bought a dress online’ moment.
The joy of planning means you can shop around and find the best bargain – whether that’s a holiday, a utility provider or even a pair of trainers.
I now get the same rush saving money on items, as I did when hitting Bluewater. The search for a bargain is truly satisfying and I can say hand on heart that I don’t pay full price for 80% of what I buy now.
If you were starting on a fitness journey, you’d have some goals in mind, wouldn’t you? Whether that’s a certain weight goal or that you could run 5k? It’s important to do the same with your finances.
It’s good to keep them realistic – while I would’ve loved to have paid of all my debts last year, I instead set my goal as paying a certain percentage of them. I also started a Christmas fund, where I put a minimum of £25 a month in, so come December, I’m not skint. Whatever your goal, write it down, work out the steps you’re going to need to get there, and do it.
I am no financial expert, but thankfully there are lots of great people out there who know money inside out. Whether you decide to consult a pension expert or just start visiting Money Saving Expert on a daily basis, there is help out there for you, so use it, and perhaps 2020 will be the year you stop worrying about your finances and start living your life free of so many money worries!