Ready to ditch bad money habits and sort out your finances this year?
Lofty goals of saving thousands by a certain date or an airy vow to just be ‘better with money’ can feel a tad daunting, so perhaps a better approach is this: taking on one step each month.
Handily, Virgin Money’s money-saving expert, Alina Jaffer and personal finance expert Faith Archer, have put together a month-by-month calendar that will help you on your journey to a 2022 money makeover.
Alina says: ‘The start of the New Year is the perfect time to reassess your financial position and begin budgeting and planning for the year ahead.
‘We hope that these expert tips will help people to achieve the ultimate money makeover for 2022 and start the year with a positive attitude to your finances.’
Ready? Here’s your task for each month
January: Build a budget
Sounds boring, we know, but having a proper budget is the foundation for sorting out your finances.
We’ve got a useful guide for making your own budget spreadsheet, but feel free to use an app or a notebook instead – whatever works for you.
Faith suggests: ‘You can get off to a great start in 2022 by planning your budget for the rest of the year.
‘You should start by checking your bank statements to see where your money goes. Then build a budget to allow you to free up money to pay off debt, while also setting money aside for savings.
‘A handy tip is to make sure you’re keeping track of how much you spend on different things during the month, so you can set individual budgets for each and keep track of how you’re doing.’
February: Get into the saving habit
You’ve worked out how much you’d like to save – and how much you can put away, realistically – now it’s time to do it.
‘Set up a monthly direct debit to your savings so you’re not tempted to spend everything left in your bank account,’ suggests Faith.
‘Whether it’s saving just a pound a day, or £100 a month, putting money aside regularly will help you afford to splash out on a special occasion in future.’
March: Sell your old stuff
Planning a spring clean? See what cash you can nab for your clutter.
‘Everything from clothes to computer games can be sold online and turned into cash,’ says Faith.
‘What’s more, with a huge range of websites for selling used items, like Ebay and Music Magpie, Depop for clothing, Gumtree and Facebook Marketplace for larger products, there are plenty of opportunities to take advantage of.’
April: Spring clean your bills
When April hits, set aside a chunk of time to go through your bills. Are you overpaying? Could you save a load of money by making the swap?
And what about subscriptions? Are you paying for something every month that you aren’t really using?
Faith says: ‘Scan through all of your regular payments and think, “can I ditch or switch?”
‘Do you need subscriptions to multiple streaming services? Do you use that gym membership enough? If the answer is no, consider ditching them to save some money each month.
‘For bills you can’t cancel, like utilities, car insurance or your phone bill, have a look to see if you’re paying more than you need to. If you can find a better deal elsewhere, it’s worth switching providers to save cash.’
May: Prioritise clearing your debts
‘Make a list of what you owe and where, jotting down the balance, minimum payments and interest rates,’ recommends Faith.
‘From here you can decide how to proceed. Do you want to tackle the debt with the highest interest rate first, to save yourself the most money? Or would you rather start with the smallest balance first, for the motivation from clearing a debt?
‘Make sure to keep up the minimum payments on all your other debts, while putting any extra money towards clearing one in particular.’
June: Save on spending abroad
You might be looking at the best travel deals and finding the cheapest hotels, but have you thought about the money you’ll spend while you’re there?
Make sure you choose a current account that offers zero fees for debit card payments and cash withdrawals abroad, so you’re not overspending.
And if you take some foreign currency in cash, exchange in advance rather than paying over the odds at the airport.
July: Look for rewards
You could unknowingly have all sorts of rewards built up and tucked away. Use this month by having a dig around for any cashback or loyalty points you’ve built up, and seeing how you can make the most of them.
August: Think about heating
We know – when it’s hot, the last thing you’ll be pondering is how to get your house warmer.
But that’s exactly the point of this month’s goal.
The experts say the summer months are a great time to install insulation and get your boiler serviced, before the winter rush leads to hiked up prices.
September: Get learning
Many of us got through school without a single class on financial education – no wonder so many of us feel clueless when it comes to money.
For September, set yourself the challenge of swotting up on all things money, whether in the form of books, blogs, or podcasts.
October: Ditch future fear
‘Halloween may be looming, but you don’t have to be frightened about your financial future if you save towards retirement,’ says Faith. ‘The government will even treat you to free money, by adding 25p in basic-rate tax relief to every £1 you pop into a pension.
‘Higher-rate taxpayers can claim back even more. If you can pay into a work pension, grab the chance with both hands, as your employer will add money too.’
November: Be cautious around Black Friday
Stay conscious of all the ads you’ll be bombarded with this month, and resist the urge to overspend in the sales.
Do your research to ensure deals are genuinely decent, and take time to think through purchases before you hit ‘buy’.
Get strategic, too – have a list of things you truly need or want (for yourself or as gifts) and don’t stray from that, no matter how good a price-slash may seem.
December: Shop savvy for Christmas
‘Plan ahead so you can have a special Christmas without breaking the bank,’ says Faith. ‘Tot up how much you want to spend on everything, from presents and food to travel and socialising, then break it down into a spending limit per present.
‘Start shopping early, so you can take advantage of sales, search for discount codes and avoid express delivery charges.
‘Then focus on festive memories that hardly cost a penny, such as making your own mince pies, heading out after dark to see Christmas lights and settling down for a family movie night.
If you want more tips and tricks on saving money, as well as chat about cash and alerts on deals and discounts, join our Facebook Group, Money Pot.
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