As we embark on the early weeks of a fresh decade, the fun and festivities of the Christmas and New Year period begin to feel like a distant memory. January and February can be difficult months for many, as people deal with the comedown of heading back to work after a couple of weeks of too much food, drink and general indulgence.
It can also prove financially challenging, as we attempt to reconcile all of our extra spending over the Christmas period, with the Bank of England estimating that a typical UK household spends an additional £800 in December compared to other months.
Unfortunately, money worries are something that affect more than half the population, with 55% of adults experiencing concerns over their mental health because of financial issues. If you’re starting to feel anxious about how your bank account is looking in the early stages of 2020, these tips can help you get back on track.
Sit down and work everything out
The first step is to take some time and crunch the numbers. That means sitting down, going through your bank statements and recording everything that comes in and out. By totting up the combined salaries in the household, you’ll know how much money you have to spend each month. Next, you’ll need to work out all your outgoings, including rent or mortgage payments, utility bills, food, car costs and anything else. By setting this final figure against your incomings, you’ll see how much money you have left over on a monthly basis.
Set realistic goals
From there, you should be able to set yourself some targets. Are you simply looking to reduce your expenses? Or are you saving for something in particular – a new kitchen or a family holiday, perhaps? Whatever your dreams, it’s important to be realistic – putting money aside to buy yourself a Ferrari may take a while and might not be the most practical use of your cash.
Make savings where possible
Next, it’s time to identify where you can cut some costs. This may sound daunting but you might be surprised at how simple it can be. For example, you could change where you do your food shop, downgrade your television subscription or perhaps cancel the membership to the gym that you never use. Everyone’s circumstances will be different, so it’s important that you make the changes that are achievable and won’t have a detrimental impact on your life.
Stay calm and assess your options
If the financial picture is looking bleak, do not fret. You may find that over-spending in previous months has left you a little short when it comes to covering some essentials, such as rent or bills. If that’s the case, you may wish to consider alternative solutions to help you with the costs in the short term and assist you in getting back on track.