We all start each year with the best of intent and resolve to make changes which will benefit our health, fitness and relationships.
Most are unlikely to last through January.
But with spiralling personal debt levels, falling savings rates and inflation still in the background and still steadily eating away at our wealth, it may be time for some financial resolutions. At Continuum, we have been looking at some resolutions that you should actually be able to keep – and which may leave you much better off if you do.
Resolution 1. Resolve to watch your spending
Most of us wonder where our money actually goes each month. We are all too aware of the big regular bills, such as the mortgage, council tax, and car payments. You might have a clear budget for groceries and for entertainment. But it’s easy to forget about the little things, the daily coffee, the magazine, the odd pint or bottle of wine – which add up faster than we realise.
For most of us, a phone app is the easiest way to track what we actually spend. But however you decide to do it, you need to stick with it. Not only will it let you see where your spending is headed, it is the first step to getting it under control.
Resolution 2. Resolve to cut your outgoings
Once you know what your outgoings really are, you can start cutting them. Start with the little things – a packed lunch rather than a trip to the coffee shop could be healthier for you and your budget.
Then, when you can start to see how small savings add up start looking at the bigger items. Are you paying too much for your insurance? Has your mortgage run out of the introductory rate? A call to Continuum might be able to help you cut the cost of buying your home and protecting it, yourself and your family.
Resolution 3. Resolve to ditch your debt
With the obvious holes in your finances plugged, you can look at ways to start dealing with debt.
Debts such as credit card balances cost you money. Unless you are disciplined and pay them off in full each month, they are a constant major drain on your wealth. With a little extra cash left each month (thanks to resolution 2) you can resolve to start paying them off – and it is easier if you don’t pay interest at the same time. Switch all your outstanding balances to a card with a 0% balance transfer offer, and set aside as much as you can to paying it off before the offer runs out.
Resolution 4. Resolve to start saving
There is no point saving if you have debts, because the interest you pay on the debt will be far greater than the interest a bank or building society will pay on the money you put away with them. But once you have got debt out of the way, you can concentrate on making the cash which was going on repayments and interest work for you.
To make saving rewarding you need to find the savings accounts that offer the best rates. This can mean tying up your money, so you may want more than one; one to offer instant access in an emergency, and one to provide the maximum returns.
Our Cash Calculator can be a good place to start if you are looking around.
Resolution 5. Resolve to make that money work harder
Once you have a small reserve of savings, it might be time to start turning it into a bigger one. But finding the best way to do that may be challenging. Should you put more into your pension? Should you set up an ISA? Should you start looking at the power of the stock market?
This is why our last suggestion for a financial resolution is the most important of all.
Resolution 6. Resolve to get some expert help
Getting professional help to understand your financial objectives and the best ways to reach them is essential.
At Continuum, we have many ways to help. We can give you the latest financial news with our weekly education mailer and our regular updates. We can provide expertise and market knowledge, and above all, we can give you personal help from an expert financial adviser.
So, resolve to call us – and in the meantime, let us wish you a Prosperous New Year.
The information contained in this article is based on the opinion of Continuum and does not constitute financial advice or a recommendation to suitable investment strategy, you should seek independent financial advice before embarking on any course of action.
The value of investments can fall as well as rise and you may get back less than you invested.
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