Essential steps for healthy finances

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It’s time to stop ignoring your banking app and crossing your fingers when tapping your card at the till. Here’s how to stay in control of your money

Some people are savvy when it comes to money, but many find it overwhelming. If you’re the type to hide from your credit card bill and regularly run out of money before payday, it’s time to start some healthy financial habits. Here are some simple tactics to try to make managing your money a lot less scary. All it takes is a little organisation, a tiny bit of forward planning, and the desire to see your savings account balance rise.


1. Know your numbers

We all should have an idea of what our bank balance is at any particular point in time. It’s too easy to just keep tapping these days, and sometimes it’s a little scary to see just how much we have spent, particularly after a weekend of online shopping and takeaway foods to fight the boredom of lockdown.

But that’s not the only figure you need to keep in mind. Knowing how much debt you have is so important, and keeping that figure, and your plan to reduce it, in mind everyday will make you pause each time you’re about to click add to cart or pop out for a coffee you don’t need to buy.

2. Set money goals

Maybe you have a savings account and just throw all your spare cash towards that. That can work for some, but what can be really motivational and practical is to set short, medium and long term savings goals. Maybe you want to save towards a new phone now, towards a new car in a year’s time and also towards a deposit for your next home down the line.

Rather than just throwing a random amount of money into your savings, you will be able to create a better plan when you know exactly where your money is going. WIth goals in mind, and knowing exactly how much you can save towards each goal, you can establish a realistic timeline to stive for.

3. Review your spending regularly

Examine your outgoings and all those purchases that are nice to have but not essential. What can you cut out?  Maybe you don’t use Netflix as much any more, or accidentally still subscribe to online workouts you haven’t tried in a while.

4. Be savvy when spending

Promise yourself that you will always take the time to find the best deal. That could be taking advantage of special offers when it comes to ordering takeaways, when normally you just order the same thing at full price. Same goes with grocery or online shopping, can you find something similar for less? These little savings add up. You could even squirrel away all those little savings into a separate account, and challenge yourself to grow that little fund as much as you can.

5. Take inspiration from money experts

There is a vibrant community of budgeting, finance and mortgage experts online who share lots of excellent information and advice for free. Here are a few we love to follow. 

6. Clear debt first

There really isn’t much point putting money away when you have an overdraft or credit card bill to clear.  Having loans and savings at the same time means you are overspending – without anything to show for it! Debts usually cost more than savings earn. There is an exception for when you are tied into loans that have a penalty for paying it off early.

7. Think about why you spend

How something is priced matters, and businesses know why we spend the way we do. They know some people order the second cheapest wine so as not to seem cheap, and price it accordingly. They know we are tempted by chocolates and scratch cards by the till, and by the smell of baking bread as we walk in to a shop, and so they position them in such a way to temp us to spend. Think about why you are spending, and what has influenced you to spend.


Main image: Bich Tran from Pexels