You and Your Money

You and Your Money

We all work hard for our money, but it can be frustrating when there seems to be very little left once all the bills have been paid.  Whether you’re committed to a mortgage, monthly rent, child care fees or utility bills they all add up and certainly need to be paid before you can really start to ‘enjoy’ whatever’s left.

It goes without saying that good money management can go a long way towards getting you through the month – but it’s not something many of us tend (or want) to consider.  Invariably, there always seems to be an unexpected expense of some kind and all plans to set so much aside go firmly through the window.  So what’s the key to success?

Firstly, there’s nothing more essential (or basic) than simply putting pen to paper.  By making a list of your monthly income and outgoings, you can see at a glance exactly where your money is going.  By doing this exercise, you’ll most likely recognise definite areas for improvement.  In fact, here’s a typical example:

5 x daily lunches in the staff canteen @ say, £6.00 per day = £30.00 a week

£30.00 a week x 52 weeks a year = £1,560.00 a year!

So would you feel the same if your employer said they’d deduct £1560.00 a year from your salary … just for your lunch?  Absolutely not!

Of course, this is just a very simple example but the same principle applies to travel fares and general day to day expenses.  If you travel to work by public transport, can you buy a monthly or yearly ticket?  (Just remember to consider any annual leave you might take whilst budgeting since this usually amounts to at least a month a year).

If you’re already in debt – or dependent on a regular overdraft – you might also want to consider ways to reduce it.  By simply setting aside a certain amount each month this can easily be achieved.  Again, it’s all too easy to simply overlook it but in the meantime both your debt (and associated bank charges) continue to increase.  A simple way to do this is to set up a savings account and have a direct transfer to it on pay day.  Where possible, avoid ‘instant access’ savings accounts since you might be tempted to make withdrawals when you find yourself a little short.  Instead look for one with a good interest rate and withdrawal period.  It’ll make you think twice about withdrawing funds until you absolutely need to.

 

In the meantime, if you need any debt advice then there are certainly plenty of resources available – from online affordability tools right through to confidential advice provided by Pro-Counselling EAP or other organisations such as the Citizens Advice Bureau, that are accesible to the general public.  You might also want to consider joining Experian which is currently the UK’s most trusted credit source.  It’s one of the most used credit reference agencies used by high street lenders and gives accurate, up-to-date advice on how your finances are looking.  If you need to increase a poor score you can do this in a number of ways.  One of the most common solutions is to take out a credit card and ensure repayments are always made on time.  Over time, this will ultimately give you a higher score and thus make you more attractive to high street lenders should you need to apply for a mortgage or loan.