Looking to take control of your finances in the new year? The start of the year is an excellent opportunity to adopt positive habits and make changes that will improve your financial well-being. Whether you are struggling to make ends meet, saving for something, or simply looking to improve your situation, there are lots of steps to take that can make a big difference over 12 months.
Benefits of Financial Health
First, looking at why financial health is so important is helpful. Obviously, life becomes a lot easier when you improve your situation. You can say “yes” to more opportunities, treat yourself more often, have more options when it comes to credit, and handle emergencies without difficulty. Additionally, you can reduce financial stress – this can enormously affect your general well-being.
Assess Incomings & Outgoings
A logical starting point is looking at how much money you have coming in each month and how much regularly going out. This will give you an overview of your current situation and determine how much needs to be changed. This should already give you a few ideas of areas where you should be looking to cut back.
Shop Savvy
People can often drastically improve their financial situation by making a few changes to the way in which they shop. No matter what you are buying, you should always look around to see if you could make savings by purchasing from elsewhere. This is particularly useful when it comes to things like insurance, as you can make big savings by comparing providers. If you or someone in the family is learning to drive, for example, you could opt for learner insurance which may make more financial sense than taking out a traditional annual policy. When you adopt this strategy with some of your other outgoings, you can soon free up some extra money each month.
Set Goals
It is hard to maintain financial discipline when you do not have goals to help keep you on track. It is a good idea to have a goal to work toward by the end of the year, but break this down into smaller steps so that you can stay focused and motivated. If you want to save £500 by the end of the year, for example, you can break this down into a monthly amount.
Keep Track
As with most New Year’s resolutions, it can be easy to lose motivation after a few weeks. To avoid this, try getting into the habit of regularly checking your budget to keep your finances at the front of your mind. Crucially, make sure that you are still able to enjoy spending money and don’t forget to make allowances for one off events such as birthdays.
Hopefully, this post will inspire you to make positive changes and improve your financial situation in the new year. This is the perfect time to revamp your finances and make changes now that will improve your situation and reduce financial stress over the coming year and beyond.
