The Coronavirus hasn’t just caused a lot of problems, it’s highlighted existing ones and possibly made them worse. For example, it’s common knowledge that years of austerity have left many people on the financial edge, if not actively struggling. It’s also common knowledge that many people in the UK experience mental health issues to some extent. These are often connected. Resolving one does not guarantee to solve the other, but it may help a lot. With that in mind, here are some tips on managing your money healthily.
Ask for help with anything you find difficult
A lot of financial matters are managed online these days and while that works very well for most people most of the time, it doesn’t work well for everyone all of the time. Government websites can be very complicated to navigate, especially if you’re the proverbial round peg trying to fit into a square hole, such as a self-employed gig worker suddenly trying to navigate a system which was created for the needs of people in employment. If you’re struggling, then ask for help. Even if you can’t get it in person you may get it over the phone or online.
Create a financial planning system which works for you
As a minimum, you want to aim to have your finances planned out so you always have a clear overview of what lies ahead for the next 12 months. If you can plan further ahead, that’s great. Some people may even be able to plan 5-10 years ahead, but if that’s not you, that’s fine.
Leaving aside planning for retirement, planning further than a year ahead is usually only a big deal if you’re anticipating a major life event and in that case, you’ll have a specific goal for which to aim. The reason for planning a rolling year ahead is because it allows you to plan for annual purchases/occasions, which might otherwise take you by surprise if you only planned by month or quarter. It also allows people on variable incomes to think about how much they really need to save to see them through the “famine” times.
Whatever option you use, you need to make sure that it allows you to see your priorities in a way which makes sense to you. Spreadsheets and budgeting software may be great choices for some people but again, if that’s not you, then that’s fine. Try looking on social media for inspiration on what works for other people and then adapt it to suit your tastes.
Get to grips with budgeting
Budgeting is essentially the art of making your money last as long as you need it. It can be difficult enough for people with regular, fixed incomes and regular, fixed expenditure. It can be even more difficult for people who have irregular incomes and/or irregular expenditure. In fact, it can be a major source of stress and other mental health issues.
Getting a workable budget together can go a long way towards making your life calmer, so it’s really worth making the effort, even if it takes you a few tries to get it right. Here are some tips to help.
Take a close look at where your money is going now. Check your receipts, not just your bank statements, especially when it comes to shopping in larger stores, where it’s very easy to slip non-essentials into your trolley and then convince yourself that you’re only buying what you really need.
Stop using direct debits. This may seem like an odd tip, but if you’re struggling to remember that you need to keep money in your account to pay bills, then you may want to pay bills manually as soon as you have money rather than wait until they come due.
Only commit to contracts when you’re sure that you can afford them and that you’ll get real value out of them.
If you need professional help, please contact us.