The easy way to keep your finances in order
Does money confuse or even scare you? That doesn't need to be the case – just follow our simple guide
Many people worry about managing money, but it's not actually that tricky. The crucial thing is not to spend more than you earn. Keep a record of all your outgoings, preferably for a month. A Microsoft Excel Worksheet can add everything up for you. Once you have the figures in front of you it's easier to spot where to make savings.
Try these tips to help you get organised.
Double up
Cut bills and possibly charges, by getting your electricity and gas from the same company. Consider 'bundling' your broadband, phone and cable TV. And save petrol by shopping online too.
See www.tesco.com.
Manage debts
Establish how much you owe, work out which debts need to be repaid quickest, such as council tax, to avoid trouble. Then pay off the debt with the highest interest rate. We call this snowballing.
Got more than two credit cards? Cut up those with the lowest credit limits and highest interest rates plus store cards too.
Transfer balances to a 0% interest card if possible, then make regular payments to clear it by the end of the free period.
Many 0% cards still charge interest on purchases so use a cashback credit card for spending – it pays back around 1% in cash.
Banking
Have just one current account, preferably registered online, so you can quickly transfer money at home and avoid unnecessary charges.
Pay the mortgage, bills, loans and credit cards by direct debit or standing order so you don't forget and incur any penalties.
A few rules for safer internet banking:
- avoid easy-to-guess passwords
- keep your login/password secret
- ignore emails or calls asking for personal information
- use anti-virus and spyware software, plus a personal firewall, to keep your computer secure
- check your bank website has a padlock symbol
- check regularly for any transactions that you don’t recognise making
Do a one-stop window shop for essential service suppliers at the Tesco online comparison site. Tesco Compare features a range of well-known brands and allows you to compare prices and features for car, home, travel and life insurance, credit cards and loans, plus gas and electricity suppliers.
Visit www.tescocompare.com.
Investments
Look into your pension plan – those with final salary schemes might be worth keeping open, but you may be better off transferring others to a new plan. See www.aifa.net for a local financial advisor.
Don't forget to make a will. A solicitor or will writer can do this for you. Make sure details of your accounts, insurance, pension and savings can easily be found. For information, visit www.adviceguide.org.uk.
Keep it tidy
Save space by eliminating paper where possible. Buy a shredder to get rid of documents with personal details. Ask banks to email you paperless statements. File them in folders on your computer. Back these up regularly on an external hard drive.
