Make like George Osborne and fight back against spiralling day-to-day expenses to save.
Love him or loathe him, today George Osborne, Chancellor of the Exchequer, has the unenviable job of announcing the nation’s financial agenda. The somewhat weighty responsibility of attempting to redress the deficit and making the UK’s financial planning accountable to it’s public is his. Whether or not you agree with his ideas, the practice of taking stock of your finances with the aim of making your money work harder is worth some thought.
The cost of living is increasing at an alarming rate. A national price tag of £33 billion just to run our homes equates to roughly £1,360 per month in essential bills a month for each of us. Whether you’d consider yourself comfortably off, just about getting by, or worse, a little financial savvy with everyday costs
With the Budget announcement today and the start of the new financial year on 6th April, now could the perfect time to issue your own financial mandate. Take a tip from the Chancellor and look at how day-to-day spending changes, such as switching energy suppliers, could complete the picture for what you want in the year ahead.
Here are five quick ways you could wield a red briefcase over your own finances:
1. Find your focus
Anyone can submit a proposal for budgetary consideration in January and February each year. An effective Chancellor has to balance the competing expectations of different industries to finally present his considerations on a select number of issues in the Budget, just as you balance the different demands of your household.
Having balanced your everyday priorities, being selective with your targets could bring your finances long-term into focus, whether you’d like to travel the world, simply pay off your mortgage, or retire in comfort, for example. Your Goals on Money Hub allows you to easily set saving and debt goals to match your specific priorities which are then measured against your spending, giving you an at-a-glance view of how on track you are.
2. Do the spending maths
Getting a clear picture of your income and outgoings across all your accounts on a regular basis could allow you to identify where savings can be made, or where you might not be meeting your targets. You might want to also keep track of insurance renewal, expiring warranties and other key dates to avoid any nasty surprises. Money Hub allows you to input your transactions and generates patterns for your spending, so you can take full control of your everyday expenses. If you want to go one step further, our Account Connect service (available for £1.49 a month) automatically syncs your bank account transactions.
3. Present your own Budget
(Parliamentary audience optional). Budgeting isn’t just about cutting back: a recent study suggested that 55% of millionaires keep a stringent budget. Simply working out what you could be spending on key categories, such as bills, food and socialising against your income would give you a sense of how well you’re doing towards your longer-term goals. Money Hub (right) could help you formulate your own Budget proposal: it encourages you to work out your spending using categories which can be as broad or as custom-made as you like.
4. Start a rainy day fund
The key to any successful economy is stable growth, and it might be worth thinking about how you can build a financial safety net at home in case your budget aims fail. Various sources have suggested a contingency fund could be roughly three times your monthly salary, but it could be any amount you think could cover you if you had an unexpected expense, such as a boiler breakdown or a car that refuses to start. Life cover and other forms of insurance could add protection against any nasty surprises. Check out our savings calculator and insurance cover pages to find out more, and consider keeping tabs on the progress of your rainy day fund using Money Hub’s savings goals and tools.
5. Fund your retirement
State pensions and funding retirement is often a big national Budget topic and in recent years state pension age has been a big talking point. Do you have a retirement funding gap? When’s your planned pension age? Money Hub’s pension tools could help you to calculate the pension income you’d need for your lifestyle and desired retirement age.
HM Treasury’s Budget takes place once a year, but that doesn’t mean yours has to. Our Money Hub tool could put your firmly in the driving seat behind your finances, allowing you to make a budget, keep track of your spending, and plan for whatever you hope for in life. So, become your own Chancellor to fight back against the rising cost of living and take control of your fiscal future.