Whether you’re lusting after a more shapely bottom, want to learn the ukulele or just vowing to get to bed earlier, with New Year resolution fervour hitting, I’ve a few more to add to your list.
For most people, taking a deep breath and sorting your finances could give yourself as much as the equivalent of a 25 per cent pay rise in just one day. To help, here are my suggestions for the top 10 money resolutions:
I resolve to... do a REAL budget. How much do you earn a year?
Easy question. And how much do you spend? Errrr... Spend more than you earn and you’re either building up debt or eating up savings.
It’s crucial to know if your finances are balanced, and this is the time of year to assess them. Yet most budgets are frankly worthless, due to some failings.
You need to look at more than just a month’s spending. This misses out infrequent but costly spends such as Christmas, summer holidays or even a sofa bought every few years. These need factoring in (so if you spend £600 on Christmas, that’s £50 a month).
Look at the little picture, not just the big one.
To help, I’ve developed a free budget planner at www.budgetbrain.co.uk. Once done, the next step is to try to stick to the budget.
To do that, the easy self-discipline trick is ‘piggybanking’.
I resolve to... stop the Big 6 energy companies overcharging me.
All the big energy providers have now hiked prices, which means it’s now mostly a level playing field if you do a comparison.
Some people are able to cut costs by £200 and guarantee no price hikes for a number of years by getting a cheap fixed tariff. Just ensure it has ‘no exit penalties’, so if things change you’re free to leave.
To find your cheapest, don’t just speak to your existing provider. Use an www.Ofgem.gov.uk Confidence Code comparison site. Alternatively, my www.cheapenergyclub.co.uk will both compare for you, then monitor your tariff afterwards and alert you when to move again.
I resolve to... stop my car chugging so much fuel.
The biggest possible petrol savings don’t come from using www.petrolprices.com to find cheaper pumps (though it helps). Changing driving habits can cut up to 30 per cent off your fuel use and, don’t worry, this isn’t mainly about crawling.
Think of your car’s accelerator as a money pump. The harder you press it, the more you spend, so speed up more gradually. Change gear up sooner and use road positioning and attentive driving so you break less and roll to a stop more.
I resolve to... start sorting next Christmas NOW.
January’s the PERFECT time to plan Christmas, so you can have more and pay less. Grab gift wrap, Christmas cards, baubles, decorations and plastic trees right now while they’re heavily discounted in the sales, and store them in a Christmas cupboard for next year.
Then start saving for Christmas (or budgeting as in the first resolution) now. Far too many people do lust-lists at Christmas which, if you haven’t saved, leads to debt or disappointment. Far better to put cash aside each month now, rather than borrow then pay each month afterwards plus interest on top.
I resolve to... become a diary tart
It’s one of the most powerful financial resolutions you can make. Good diary skills are a key part of keeping your costs down, as many consumer and financial products give you a good deal for the short term, then whack up the cost after a time.
So check now when things end, and put a large red note in your diary a month before the crucial time (or in bold in a web calendar), so you’ve time to disloyally tart to a new cheaper provider.
I resolve to... reclaim, reclaim, reclaim.
If you’re short of cash, it’s time to see if any has been unfairly taken from you. If so, you may be able to get serious cash back. - Had a loan, credit card or mortgage in the last 10 years? If so, you may’ve been mis-sold Payment Protection Insurance, or sold it without knowing (even if you rejected it at the time it could’ve been added).
You can reclaim without paying a company to do it. Free help and template letters at www.mse.me/ppi (the biggest success I’ve had reported so far is over £80,000 back). In the wrong council tax band? You may be one of 100,000s who are in too high a council tax band. You can get your band lowered and a backdated payout, which for some is £1,000s. Free tools to check at www.mse.me/counciltax
Wear a uniform to work? If so, and you have to wash, repair or replace it yourself, you may be able to reclaim tax – both for this year and for up to four years back. Free help at www.mse.me/uniform
Pay for your bank account? If you pay a monthly fee for a ‘packaged bank account’, then check you’re actually getting value from it.
If not, at often over £100 or £200 a year, cancel it. Many people were told to get these, or given them when they were unsuitable – a classic case is ‘free travel insurance’ which, even though it has an age cap, was flogged as a benefit to older people. Full help to check and reclaim at www.mse.me/reclaimpackages