Wednesday, 6 January 2016

New Year - Time to get the Finances in Order

New Year can be so much more than unrealistic or half hearted resolutions, it really can be a fresh start. An opportunity to get things in order and take control. Even if you've unsuccessfully tried in the past, New Year is always a time to try again.

I've got three things I would like to take control of, or do better at this year:

1. Try and be more organised, keep the house tidy and not put things off until the last minute.

2. Lose some weight and get back in shape! No fad diets for me though, it will all be down to sensible 'calorie cutback' and more exercise.

3. Be more aware of what I spend, keep to a budget and stash as much cash into savings as possible!

For me, numbers 1 and 3 are a little bit related. I need to make more of an effort to save so we can put that money towards a bigger house. The house that was the perfect size when it was just me and my husband is now full to bursting after the arrival of our two children! For such small people, the amount of 'stuff' they've accumulated has completely overwhelmed our lovely little house to the point of suffocation! Especially after Father Christmas has been...eek!

There's no room to move and even when I get the tidying bug there's nowhere to tidy anything away to! Well...except Ebay...hmmm! But that doesn't solve the problem that our growing children could do with more space.

I've been cutting back for a while now but even though I felt I was turning to cheaper brands and looking out for offers, when my credit card statement arrived each month it was always more than I wanted it to be! :(

Especially during November and December when the Christmas shopping took over...!

(Just for the record, I pay my credit card off in full each month to avoid any interest. I just prefer it over a debit card as I get to keep the cash in the bank longer therefore gaining interest and I get loyalty points when I spend on it.)

In order to gain back control, I've installed a spending tracker app on my phone and every time I spend anything I log it. This is set against a monthly budget that I've set myself, so I now have a very CLEAR idea of what I'm spending as the month goes on. Rather than waiting for the bill to arrive and thinking I'll try harder next month!

I've already found that keeping this record has influenced my purchases and has helped me cut back. Especially with small things. I've cut back on magazines, the odd lipstick or eyeshadow that happens to take my fancy, coffees when out and about as well as food on the go. It's surprising how quickly a few quid here or there can mount up! Now, I'll save these as treats towards the end of the month if I've still got money leftover from my monthly budget.

It's also made me question whether the things I want to buy are things we really need or not. Do I really need another pair of shoes, how much am I going to wear them and if I don't buy them will there be other shoes in the future (when I've got more disposable income!) that I'll probably like just as much!

Keeping a close eye on my spending has also made me more likely to return something I've bought if I can't quite justify it to myself once I've got my shopping home or had a night to sleep on it!

I'm not turning into to Scrooge, but I do want my spending habits to be a bit more considered. And how good would it feel at the end of the month if I did have enough left over for those shoes *wink*! What an incentive! Joking aside...I feel like this January is a chance to start a fresh, put things into perspective and enjoy the challenge of a more frugal year ahead!

Some other things I'll be looking to do over the next couple of weeks is review what's going straight out of my bank account, direct debits and the like, and see if there's anything I can cancel, switch or renegotiate. As well as making sure I've got the best bank account for my needs.

Note: The app I'm currently using is called Spending Tracker and was free to install. There are others available but this is the only one I've tried and so far it meets my needs perfectly and is easy to use. If you didn't want to use an app good old Excel or even pen and paper would work just fine! I just find a phone app really convenient especially when out and about.

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