Fixing your finances at the start of a new year may not seem as exciting as other New Year plans, but it plays an essential role in getting on top of your financial wellness.
Your financial health is closely related to your physical and mental health, making it just as important to stay on top of it as other New Year goals and resolutions.
We understand that financial management can feel intimidating, especially when you’re just getting started and even more so just after the holidays. The good news is that it might actually be easier than you think.
In this article, we’ll explore some actionable ways to fix your finances in the New Year and set yourself up to take back control of your finances. By implementing these financial management tips, you can regain control of your finances and start working towards your financial goals.
1) Start Using a Budgeting App
Successful budgeting isn’t something that happens overnight. If you want to fix your finances and plan for long-term success, you need to create a reliable system to help manage your finances month by month, week by week.
Financial software isn’t just for investing. In fact, there are many budgeting apps available to help you better track your daily and monthly expenses. From spreadsheets to mobile apps, you can choose a system that you feel comfortable with and give it a try.
However, when choosing your budgeting app, make sure you check the app ratings and reviews to ensure the app you choose has a good track record with customers. Once you’ve narrowed down your choices, download and use it for a couple of weeks.
The best part of budgeting apps is that there are multiple options to choose from, so you can rest assured that you’ll find the ideal budgeting app for you. If one isn’t working for you, you can always try another app.
Don’t forget to explore your bank’s mobile app too, as some banks’ apps have built in budgeting tools already.
2) Improve Your Credit Score
Whilst not something we check at Salad Money, your credit score is still very important. Having a poor credit score can affect your finances in many ways, mostly limiting your access to finance, whether it’s day to day borrowing, a mortgage or for a car.
A good credit score makes you more likely to be accepted for credit and can open up access to more favourable interest rates. It also indicates that you have a history of managing your credit responsibly and making repayments on time. With a good credit score, companies are more likely to see you as a low-risk borrower, thus increasing your chances of being approved for credit.
While it can be frustrating if your credit score is less than ideal, the good news is that you can always improve your credit score. By understanding how your credit score works, you can identify why your credit score is low, what you can do to improve it, and how to fix your finances.
3) Automate Your Savings
If one of your goals for the New Year is to build an emergency fund, then automating deposits into your savings account is a great place to start. Instead of manually remembering to transfer money into your savings account from your monthly paycheck, automate the process.
Automating your savings is an effective way to take the thinking out of your finances, as it helps you build your savings without having to actively having to take action and becomes a habit. This can also help avoid overspending and help you build consistent savings.
By automating your savings, you ensure that you have a safety net to fall back on in the event of a financial emergency.
4) Set Short-Term and Long-Term Goals
Assessing your current finances is an important step to determining your monetary priorities, establishing goals, and finding ways to fix your finances.
Everyone has goals they want to achieve, whether it’s a holiday, paying off debt, or buying a new car. Good financial management is filled with multi-step plans that help you get closer to your goals. By setting short and long-term goals for yourself, you can focus on saving and working towards making your goals a reality.
Saving for events that may be far into the future can feel overwhelming, which is why it’s good to build short-term goals alongside long-term ones. Short-term goals help you stay motivated and on track in your financial journey.
This New Year, set SMART saving goals and then break these goals down into smaller, easy-to-manage bites to ensure you stick to them. By understanding your current financial state and setting short and long-term goals for yourself, you can effectively plan for your financial future.
Choose Salad Money for Fair and Affordable Personal Loans
Financial management doesn’t have a one-size-fits-all solution, and what works for someone else may not always work for you. However, if you want to fix your finances in the New Year, educating yourself, making changes using the above tips, and making informed financial decisions will help you get your finances back on track.
At Salad Money, we recognise that effective financial management isn’t always easy for everyone and you may require some financial support to help you get through a rough spot. That’s why we offer fair and affordable personal loans to help you overcome your financial challenges.
As a prominent UK lender, we are dedicated to offering you the financial support you need to get back on your feet. That’s why our ‘More Than Your Score’ loans allow you to access the funds you need, regardless of your credit score.
Additionally, we are an FCA-regulated and authorised organisation, which means that you can trust us to keep your financial data secure.
To learn more about our personal loans, click here and to read more blogs like this one, visit our blog page now.
