No matter what stage of life you are in, it is important to manage your money. If you are not managing your money effectively, you are going to miss out on savings. You may also end up getting into debt. Climbing out of debt and getting back on the straight and narrow can be challenging. To effectively manage your money, you need to have an action strategy. This will help you assess all areas of your personal finance and help you make the most out of your money.
Find Your Starting Point
The first thing you need to do is establish your starting point. Do you have debts that you are dealing with? Do you need to start saving for a new deposit on a flat? Or are you looking at returning to education? When you have your starting point, you then have the time and the space to evaluate what you need to do moving forwards. If you have no starting point, you will struggle to have a clear vision of what you want to achieve (and what you can achieve).
Useful Info: Look at your spending and outgoings. Try and monitor what is happening with your accounts on a weekly and monthly basis. When you can do this, you can start to see where changes need to be made.
Managing Ongoing Claims
There may be many reasons that you decided to make a claim. For example, you may be making a claim against a provider that has mis-sold insurance to you. Or you may be currently going through a claim such as a car emissions claim you may feel like you are in limbo. Ongoing claims can take longer to resolve than you initially anticipated. If you are looking for financial compensation from an ongoing claim, it is important to factor this into your action plan. Do not include amounts that you expect to achieve, instead, put claims on the back burner. When you are focused on what you can potentially receive from a claim, you get sidetracked. This sidetracking can blur your vision and stops you from focusing on managing other areas of your personal finances.
Useful Info: File and log your claims, then put them to one side. Once claims are filed and managed, then look at moving on to something else, such as reducing debt or building a savings buffer.
Start Building a Savings Buffer
When you have started looking at tackling debt(should you have any), it is then time to start focusing on building a savings buffer. Even if you have a steady stream of income or work now, it doesn’t mean this will continue. It is essential that you create a savings buffer that allows you to live comfortably for at least six months. Without this buffer, you may find that you put yourself under unnecessary stress. To build a suitable buffer, you need to set targets and goals and focus on cutting back and saving regularly.