Top Tips for Financial Wellbeing and Awareness
If you’re looking to feel more secure and confident with your finances, there are some simple steps you can take to start laying the groundwork.
These tips can help you build awareness and understanding, which can lead to a strong sense of financial wellness and peace of mind with your spending habits.
Track Your Spending
If you don’t know what you are spending money on, you won’t know what you can change. Tracking your spending gives you a clear picture of where you are prioritising your money. You can then consider whether these purchases are in line with what you want to financially achieve in life.
Make a Budget
Making a budget can help you track your spending. Categorising your monthly purchases into things like “Home” “Entertainment” “Debt” “Investments” “Retirement” “Family” “Selfcare” etc.
Notice if there is any imbalance across the categories. This doesn’t mean they have to be equal, but if you are putting a larger amount of money towards entertainment while sacrificing putting anything into retirement, this might be an opportunity for changes.
Know Your Bank Balance
When using cash was more common place, it was easier to keep track of your outgoings. Contactless payment options often lead to tapping away money without knowing what you’ve spent.
Paying attention not only to each transaction but reviewing your bank balance regularly throughout the month can help you avoid overspending.
Manage Your Credit Score
Do you know what your credit score is? Do you know what your credit score tracks? Do you know why your credit score is important?
Knowing the answer to these questions can help you understand the importance of a strong credit score. And if yours isn’t as high as it could be, there are ways to bring it up. Speaking with a qualified financial advisor can help you find out the best ways you can improve this important number.
Little and Often
Don’t get caught up in the number in your saving account, pension pot or ISA not being high enough. Just keep putting away a little bit as often as you can and allow compound interest to work its magic. If you are ever able to deposit a larger, one-off sum, or you are able to increase the amount you are putting in on the regular, it’s not a bad thing to invest in.
Though there is never any guarantee on the performance of any pension or investment, do not underestimate the benefit of little and often.
Have a Plan
Knowing what you want your present and future to look like can help you get your head on straight when it comes to spending money. Wanting to retire at 68 will likely mean you have to make different choices then if you are willing to retire at 75.
If you have a plan for what you want to achieve, the pursuit of the goal becomes clearer. If you know you need to save for an upcoming holiday, you might pass on that cheeky takeaway. Focusing the mind can help focus the bank account.
Stop and Think
If impulse spending catches you out, stop and think before you make a purchase. There are various techniques and systems that can help you practice mindful spending. The Japanese Kakeibo is a popular one for our team.
Find what works for you to take that moment of pause. Is it counting to 10? Humming a verse of your favourite song? Picturing a holiday, your dream home, early retirement. Whatever it is, do it and practice it often.
The Bigmore Belief
At Bigmore Associates we believe that financial wellbeing is attainable for all. It is not about how much money you have, it’s about how to align your money with what matter most to you in life.
Once you are able to do that, you have the ability to gain confidence and peace of mind in the financial decisions you make.
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