Simplify Your Finances In 7 Easy Steps

The start of the new school year seems to bring about a sense of starting over. New goals, expectations and plans for the next 12 months. A lot can happen in that time! The same can be said about your finances; lots of things can change in the space of 12 months and you can do some steps to simplify your finances.

 

Sometimes finances can seem so overwhelming it can be difficult to know where to begin. Especially if you’re a beginner in tracking your spending and trying to budget. But, don’t worry! Everyone has to start somewhere 🙂 and if you take your time and go steadily, then you’ll get the hang of it in no time.

 

But, there are some things you can do to simplify your finances, to make it easier:

 

1. Automate everything. All of your direct debits and standing orders; check that they are all still necessary and then automate it so you don’t have to think about anything. Preferably, if you can get all of these to go out of your account on the same day, then this would be better. As soon as all of your fixed expenses are gone, then you know how much you have left to live on! And automating can include your savings, if you want.
2. Get rid of the paper trail. Where possible, end the paper trail. For example, don’t get your bank statements sent in the mail. Check your online banking regularly instead, so that you can see if there’s anything amiss. Less paperwork is better for the environment, but it’s also better for your home. It’s also less stress – not having to sort through lots of paperwork constantly.
3. Create a flexible budget. Having a budget means having a plan for where you want your money to go. In the first few months, keep it flexible. Don’t budget to the last penny, just in case you need different categories to change. [see How To Make A Budget]
4. Pay cash. Now, this is a very divided subject but, where possible, try to pay with cash. Handing over physical money makes it seem much more real in terms of spending but actually, it’s easier to keep track this way. In fact, using my simple budget planner is helping me with this.
5. Only have one credit card. Multiple credit cards can be tricky to keep track of and can inevitably end up leading to more spending. Especially if they’re contactless; a quick swipe and you’re done. Stick to one card and pay it off each month. Automate this payment!
6. Check that everything you pay for is necessary. Don’t have any payments in there that you no longer use or need; gym payments are a good example of this. You cease going but the payments continue. Check this and cancel anything you no longer need.
7. Consolidate your accounts. It seems to be a trend at the moment to have multiple current accounts, plus savings, plus retirement accounts. If you can, try to consolidate these into as few as possible. Have only one current account instead of three. Simplifying your finances in terms of what you need to keep track of can help. Plus, less accounts mean less log in details to remember!

 

I’m all for simplifying your finances. Anything that makes it easier to track incomings and outgoings is great in my book. Although I tend to track our budget by writing it down, most of these I do regularly. And, simplifying your finances makes it less stressful!

 

Do you agree? What else would you add to that list?

 

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