Make like the Chancellor and set your own budget
Now that the dust has settled over the Budget, the battle lines are being drawn over what it means for us all. From cautious to optimistic views, almost all economists and experts suggest most of us will be worse off – with some estimates suggesting by £3,000 a year.
There are many reasons for this from rising costs and lack of availability of key goods to stagnating wages. Frankly, it’s all rather depressing.
I know from your messages that making ends meet is a big concern – so here are a few things you can do to get on top of your finances.
The budgeting basics
Take an in-depth look at your bank accounts. But set yourself a time limit of no more than 30 minutes. Just getting started is the most important thing.
You can download free apps, watch flashy guides on Youtube or check out lifestyle blogs from ridiculously organised people. But budgeting is best when it’s basic.
A simple spreadsheet is all you need – or a blank piece of paper. If you have online banking, you can get a list of standing orders and direct debits with one or two clicks. List outgoings honestly, including things you pay as you go, like food, travel and lifestyle spending like entertainment and takeouts.
Now let’s get some cash back
Go back 13 months through your bank statements and note down anything that you don’t recognise.
Why 13 months? Many businesses sign you up to annual payments that might have slipped under your radar. People sometimes spend hundreds of pounds each year on sneaky annual debits for things they don’t want or need.
Ask your bank to cancel these things straight away – and claim back the money if you haven’t authorised the payments. You can dispute unauthorised transactions through your bank or card provider or take it up direct with the firm that’s debited you – it’s up to them to prove you said they could take the cash.
Contact your creditors
If your household income is tight or you’re struggling to stay on top of things there’s a lot you can do to tackle the problem before it gets out of control.
The rules about financial difficulties are clear. If you’re struggling to meet your financial commitments and ask the business for help, they should come up with some solutions for you to help you buy time while you get back on your feet again.
They should also consider suspending interest and charges for a short period if it’s making your situation worse. This doesn’t mean money you’ve spent will be refunded, but it does mean money you’ve been charged on top might be refunded if there’s a good reason for doing so. Loan, mortgage and credit payment holidays are available too so ask if you’re struggling.
If you don’t need it, cancel it
Not using that gym membership? Do you rarely tune in to that TV streaming site? How about that healthy lifestyle app that’s £5 a month? Every little bit adds up – so ditch what you don’t need.
You may be surprised what you find. Online statements and busy lives mean we often don’t notice we’re paying for contracts that have ended, have been billed for subscription traps after free trials or have forgotten to cancel things like old mobile phone insurance policies.
Get a (free) plan.
If your financial difficulties look like they might be longer term, then speak to a free service such as Stepchange, a charity set up to help people get on top of their finances. They’ll contact your creditors for you and negotiate payments you can afford.
It’s not easy, but it’s a solution and never pay for a debt management service – there are free options out there.