5 Ways to spring clean your finances | SBCA Experts

5 Ways to spring clean your finances

By 3rd February 2020Business Management
Spring clean

Roll up your sleeves and get ready for our guide to dusting off your finances ready for the year ahead.

As we move into the new year, you may be in the mood for a thorough spring clean. And we’re not just talking about your home. Your finances will benefit from a declutter too.

With the end of the tax year approaching, now’s the perfect time to get your house in order. So let’s blow away the cobwebs with five tips to help you clean up your finances this year.

1, Buff up your budget

Reviewing your budget annually makes sense. Life and business are always changing so it’s helpful to take a fresh look at your regular incomings and outgoings and adjust your budget accordingly. There may be areas for improvement, but you may also find that you’ve got more wriggle-room than you expected. Keep in mind your financial and life goals. Does your budget support these?

2, Fix the leaks

As you review your budget, look through last year’s bank statements and examine what, why and when you’re spending. There will be regular outgoings like utility bills and direct debits, but you may also notice some money ‘leaks’. These are the seemingly inconsequential costs which are more of a habit, than a necessity. And when you add them up over the course of the year they can be a financial drain. For example, do you regularly buy lunch out when a packed-lunch would do? Are you in the habit of grabbing a latte on the way to the office? Cutting back on two coffees a week could save you around £300 per year.

3, Tidy your debts

Getting to grips with outstanding debt can make a huge difference to your financial health, not to mention your personal wellbeing. First, you need to know exactly where you stand. Gather up your statements and be clear about how much you owe and the interest you’re paying. Next, make a plan (your budget review will help here). Set yourself a goal with a realistic timeframe of how much you need to pay to clear your debt. Pay more than you have to pay if possible. Tackle high-interest rates – it may be possible to transfer balances to a credit card or loan with a lower rate to help your progress.

4, Chuck out what you don’t need

You can’t beat a good old clear-out. Raid your filing cabinet, cupboards and desk drawers and go through all your old documents. File statements and papers electronically that you need for reference – and dispose of old bills and invoices safely, shredding is best.

5, Make a plan

Now you have a clear picture of your finances and a renewed sense of direction, it’s time to think about the future. What are your financial goals for the next 5 years, 10 years, 20 years? Perhaps a dream home, a world-trip, or simply being better prepared for emergencies or to boost your pension? What steps do you need to take this year to move you forward? Having clear goals will steer you in the right direction and set you on the road to financial success.

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