The best way to make the most of your money is to plan ahead and be prepared for any large expenditures that may be on the horizon. Working out your finances on a month-to-month basis will get you by, but if you really want to improve your finances you need to think long term. By assessing the next year you can make a practical plan which will keep you financially secure all year round.

Be prepared

Make a full evaluation of your income; include tax, bonuses and any possible variations. If you are self-employed or your wage is based on commission then this can be difficult to predict. It is safer to underestimate than be too generous with your figures. It is also worth considering how your job might change in a year. Even if you are set for promotion, it is wise to only account for these changes once they have happened. If your job or income is in any way at risk then it is important to know how much money you need to get through the year. This will be helpful when looking for new work and opportunities.

In addition to managing your income, a crucial aspect of financial planning involves meticulous consideration of your expenditures. Precision is key here; avoid approximations and instead delve into the specifics of your spending habits. Scrutinize your bank statements from the past year, documenting every recurring payment. By examining these figures, you can project your expected expenses for the upcoming year. It’s essential to account for all bills, including those not paid consistently throughout the year, such as council tax. Moreover, factor in potential unforeseen expenditures, such as property damage. For instance, if you encounter issues like a damaged roof, you may have to explore contractors offering roof replacement old saybrook, or in your local area, and assess replacement costs to include in your financial considerations. This thorough approach ensures a more accurate and comprehensive financial outlook.

While you are sifting through your accounts make a note of any areas where you spend a lot of money. Could you cut back by dropping the gym membership and taking up running instead? Is the pub your weakness or even fine restaurants? Do you spend more than you need to on shoes? Being aware of any areas where you could save money will help you to get a better grip of your finances.

Have a spring clean

Do your electricity providers offer a discount if you pay using a different method? Have you used the same home insurance company for several years with no offer of reduction or savings? Could you do with reducing your mortgage payments? If you pay rent, are you paying more than you should be? Perhaps you have been waiting for your landlord to make repairs. Set some time aside to make some phone calls and see how you can reduce your regular bills. Most services will offer some sort of incentive if you even suggest that you may be moving elsewhere.

Be realistic

Is your car on its last legs? Is a new one on the horizon? Is your next MOT likely to cost you a lot? It is sensible to put aside a certain amount of money each month especially for your car. It could be used for repairs and services as well as your MOT. If you do need a new car in the next year, then putting a side a smaller monthly payment a year in advance will cause less pressure than trying to find the money when your car unexpectedly gives up. With cars, it is always worth having a bit of money put by as unexpected repairs can put pressure on us all. The best way to avoid a painful MOT bill is to ensure that you service your car 6 months after each MOT. This will spread the costs throughout the year as well as catching any issues before they become problematic and expensive. It may seem like another expense, but it will save you money in the long run.

Take the time to think through any potential expenses. Are there any home improvements that you’d like to do in the next year? Is there anything that is unavoidable? If you get your home’s gutters and catchments cleaned up regularly once or twice a year, then look up “How Much Does Gutter Cleaning Cost?” and set aside some funds accordingly. Budget for the essential work and price up anything that is more of a luxury. If your wallpaper is in good condition but not in your taste, then you could always consider replacing it after a set amount of time when you have put some money aside. As well as any obvious work, be careful that you consider any potential problems that may not be expected. Boilers are expensive to service and repair, but a full replacement can really stretch the budget. If you are able to put money aside for any repairs or home improvements then you are more likely to enjoy financial security. If you don’t have the money spare to put aside each month then consider where you could cut back. A good exercise is to calculate how much money you spend on one little indulgence over the course of a year. For instance, your daily takeaway coffee might seem like a small treat but over a year it could cost you over 800.

Keep on track

There is no point meticulously planning your financial year if you don’t have a sensible method of staying on track. Breaking down your yearly plan into monthly and even weekly sections can really help you to manage things. Making brief records at the end of each week and doing a full reflection at the end of the month will help to keep you on the right path. If there are any significant changes then re-budget accordingly, safe in the knowledge that all of your planning and persistence will eventually pay off.

This article has been brought to you by Uncle Buck Finance LLP.