Eight easy ways to get your finances in order

Couple looking after their finances

Much like an over-cluttered home or backlog of work, disorganised finances can cause incredible stress and anxiety. But with a little time and effort, it’s easy to get your money in order.

By Amy McDonnell

1. Sort out your credit score

This is a tool used by lenders and utility companies to calculate the likeliness you’ll repay a loan. The higher your score, the better your chances of getting accepted for things like credit cards, loans, mortgages or some insurance policies.

You used to pay to see your credit score, but with so many free checkers on the market now, you can set up an account in minutes.

There are things you can do to improve your score that usually include good money management.

Ways to improve your credit score:

  • Registering to vote
  • Staying under 50% of your credit card limit
  • Not applying for too much credit

And some more challenging, but not impossible, things that will help:

  • Getting rid of debt
  • Paying overdue fees
  • Removing a court order for failing to repay a debt known as a County Court Judgment or CCJ 

Whatever you need to do to turn your financial frown upside down, it’s better to tackle it head-on. It may seem like an uphill battle, but slowly you’ll start seeing improvements.

2. Get the right insurance

Have you recently received a shiny engagement ring that’s worth more than your Single Item limit? Perhaps you recently changed jobs and want to protect your income in the future. 

Whatever it is, if you’ve been putting off these important chores, now is the time to revise your current policies and consider adding new ones.

In particular, we recommend looking into life insurance because without it, you could miss out on vital financial support should you or your partner pass away.

If you already have life insurance, don’t forget to update your policy if your circumstances change. For example, you may need to revise your beneficiaries if you’ve recently had a child or got married.

3. Get the best deal

If it’s time to renew your utility bills or car insurance, shop around to make sure you’re getting the best deal.

Some companies aren’t on comparison sites so it’s worth comparing all your options before settling on a deal. 

Remember, the cheapest option isn’t always the best value. You should also evaluate a deal based on what you get and by using review sites to check how companies support their customers.

4. Unsubscribe

Subscription services always sound good on the surface. Just £7.99 a month?! That’s cheaper than what I spend on lunch a day, sign me up!

However, it all adds up. Go through your subs and decide what you honestly use and what you can say goodbye to. 

If you’re not quite ready to unsub completely, consider sharing the cost with a friend, partner or parent and reduce those financial overheads.

5. Organise your documents

It’s probably time to sort out your sad little folder stuffed with bank statements from four years ago and bills for properties you no longer live in.

First, shred anything that you don’t need such as outdated documents or those you have a digital record of.

Then, get yourself a paper organiser and divide your remaining paperwork into categories such as bills, vehicle or education to make important documents easier to grab when you need them.

6. Go paperless 

Once you’ve realised how boring organising paperwork is, consider going paperless. Most companies offer paperless options, meaning you’ll get certain communications by email.  

Want to take it a step further? Set up individual folders in your inbox for each company. This way, you can easily find important emails when you need them in the future.

Also, make sure your loved ones can access where important policies like those relating to your house, life insurance or pension are saved, just in case.

7. Create a budget

If you’re not sure exactly where your money goes, it’s probably a good idea to create a budget. The most straightforward way to do this is to use spreadsheet software like Excel or Google Sheets and create two sections:

• Money in (income)

• Money out (outgoings)

From there, organise your outgoings into categories (utilities, vehicle, entertainment, loans, etc) to help visualise where your money is being spent and where cuts can be made.

Then you could set yourself a weekly budget based on how much you can afford to spare every month.

8. Futureproof your finances

Have you checked on your pension recently? If you’re changing jobs or moving home a lot, it’s easier to lose old pensions as yearly statements might not reach your new address.

Don’t worry, get in touch with the government-backed Pension Tracing Service if you’ve forgotten any past pension providers. Once you have the information, you might consider consolidating your money.

If you have a workplace pension, think about increasing your monthly payments if you can afford to. Some companies increase their contributions alongside yours, meaning your pension pot could get a bigger boost than just what you put into it. 

Remember that the value of your investments can fall as well as rise and you could get back less than invested.

If you don’t have a pension yet, you could set up a private pension. You can choose how your money is invested, make changes whenever you like and pay in as little or as much as you can depending on the scheme.

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