It’s no wonder that January is often thought of as one of the gloomiest months of the year – the festivities of December are over, you’re back to your daily routine and are counting down the days until you receive your next pay cheque.
If you woke up in a particularly glum mood this morning, you could be forgiven as today is Blue Monday, supposedly the most depressing day of the year. There’s no real science behind it but it’s the day experts predict the accumulation of miserable January weather, finances post-Christmas and broken New Year’s resolutions can leave you in low spirits.
But we’re determined to turn Blue Monday into a good day for your finances – let’s take you through how to get them in order for the year ahead.
Draw a budget
First things first – if you want to get your finances in order after Christmas, you should look at drawing up a personal budget. To do this, start off by listing all of the money that you have coming in, including any benefits or child maintenance that you receive as well as the wages of both you and your partner. The total sum is what you have to live off each month.
You then need to go through all of your expenses and other outgoings. This should include bills like your mortgage or rental payments, utility or household bills, mobile, broadband and TV payments as well as food and travel costs. Don’t forget to look further ahead to the expenses that you’re going to have coming up in the year, such as any birthdays and annual payments like your car insurance. Add all of these expenses up and subtract it from your total income, and whatever you have leftover is what you have to spend freely each month, also known as your disposable income.
Knowing how much disposable income you have every month will help you to plan for the upcoming year ahead. If you have big expenses like a summer holiday to plan for, you’ll be able to budget for this more easily and plan to save up for it more in advance.
Once you’ve set up your budget, have a look through and see if there are any areas where you can make cutbacks. Are you paying for a gym membership that you never use? Or spending money on a phone contract that you’re not really using to the fullest? If so, it may be worth looking at whether you can cut these expenses out or find a cheaper deal.
If you’re coming to the end of your mobile phone contract, you could save money by switching to a different network. Or why not ditch the gym in favour of these free workouts? Similarly, if you commute to work by train make sure you’re saving on your train tickets.
By taking the time to search around for a better deal or thinking long and hard about whether to cut an expense from your budget, you’d be surprised at how much money you could free up – money that could be put to better use elsewhere.
thinkmoney Personal Account
If you think you might need some help managing your finances for 2016, then why not consider the thinkmoney Personal Account? The budgeting account separates the money that you need for your regular bills from your everyday spending money, making sure that the important things are covered first and foremost.
The account – which is an alternative to a basic bank account – comes with a monthly management fee of £17.50 for a single account. For more information about the account and its features, click here.