1. Spend less than you make.The oldest advice is still the best – spend less than you earn. This will keep you out of debt and help you build financial stability.
2. Automate your finances. If something isn’t easy, most of us simply won’t do it. Save time and help yourself by setting up direct debits where possible. That way you don’t have to worry about missed payments or impacting your credit score! Genius.
3. Create a spending plan.Determining how much you want to spend and sticking to it is rule number one when it comes to improving your finances. There are plenty of apps that can help. Take Money Dashboard for example, a budgeting tool that tracks all of your outgoings. Simply log in and you’ll get a complete overview of all your accounts in one place. We recommend checking it regularly (you can also sign up to receive email alerts) to analyse your finances and plan your budget.
4. Save at least 10%.If you don’t pay yourself first, there won’t be any left over at the end of the month to save. If you can, set up an automatic direct debit to a savings account to make it easy. After all, you can’t spend what you don’t see!
5. Start an emergency fund.Something everyone should work towards – an emergency savings fund. The goal? Three to six months’ worth of living expenses set aside in an easily accessible account to cover mortgage, food, car payments and other necessities in an emergency. Keep it separate from other funds to avoid spending it.
6. Repay at least the minimum on your credit cards each month.And pay off as much extra as you can. Remember, a payment as small as £20 a month is often better than just the minimum! Resolve to set a goal to pay off outstanding balances as soon as you can – paying off your entire balance each month could save you hundreds of pounds in interest.
7. Begin paying off your debts as quickly as possible.In today’s economy, the best investment you can make is to quickly pay off all your debts, especially with savings rates being at an all-time low. The faster you can reduce your debt, the less interest you will pay over time.
8. Check your credit reports.In the past, credit agencies would charge users £2 a month to access their credit report. Nowadays, useful tools like Noddle and ClearScore mean you can access your credit reports whenever you want. As both accounts are free for life, there’s no harm in opening both to get a more accurate picture of your credit history.
We hope you’ve found these tips and tricks helpful! If you have any of your own we’d love to hear them via Facebook or Twitter. Here’s to 2016!