Sort out your money
Are you happy with your financial situation? Fill in the questionnaire to find out what, if anything, you want to change about your money.
Download questionnaire (Right click and select "Save as/Save target as")
How did you do? Is there anything you want to change about your money and how you manage it? Spring cleaning your approach to money will help you to feel more secure.
Are you in control of your finances?
Do you know (approximately) how much money you’ve got? If not, I suggest you start to keep an eye on it. You can waste a lot of money by not managing it properly: bank charges, wasted opportunities to earn interest, losing money by forgetting you’ve opened a certain account… not to mention scams. Even if it’s unpleasant reading, get a grip on what you’re worth financially.
Do you know (approximately) how much you spend every month? If not, I suggest you start to keep an eye on this too. There may be direct debits or standing orders you want to cancel, you may be able to get your insurance or utilities more cheaply elsewhere, you may be spending more than you realise on clothes/shoes/going out/the telephone/etc – or in the supermarket.
Is your bank account (usually) in credit? If not, you really need to look at either spending less or earning more. Living constantly in debt is dangerous and ultimately takes its toll on your wellbeing.
Your expenditure
If you are struggling to make ends meet, have a good look at where your money goes. Question every assumption. Just because you’ve always shopped at X supermarket, it doesn’t mean you can’t try out Y or Z and see if you can get the same quality for less money. Just because you’ve always got your insurance from a particular company, it doesn’t mean you wouldn’t save a lot by shopping around.
Check your bank statements to make sure there are no suspicious outgoings. Identity fraud is becoming increasingly common and, if you’re a victim, you will almost certainly be reimbursed by your bank – though obviously not if you don’t notice and report it.
If you’ve been on a mobile phone contract for over a year, you may be able to negotiate a better deal. The same goes for other long-standing relationships: if you’re a good customer, they won’t want to lose you and you’re in a strong bargaining position.
Once you really start working on it, you can save a significant amount by being careful, shopping around and not accepting deals that don’t suit you.
Martin Lewis’s excellent website Money-Saving Expert gives you all sorts of advice and ideas for how to save money.
Your income
If you are not earning as much as you’d like to, why is this? Perhaps it’s a deliberate choice (possibly subconscious) to have more free time or space in your mind and thus have a job that doesn’t occupy your full attention full time. If this is the case, accept that you won’t earn as much this way and enjoy your freedom to look after your children, write a novel, play golf or whatever is your other priority.
If this is not the case and you’re working very hard but not getting the financial compensation you deserve, have a serious look at the reasons for this. Perhaps you don’t value yourself highly enough. This was certainly true for me, for many years. I didn’t feel I could justify asking the going fee for my services and went on undercharging until I realised that people were assuming I couldn’t be that good if I charged so little. Then I put the fees up but found myself putting in extra time that I wasn’t charging for to make up for it. Don’t do this!! If you’re good at your job, you should be paid accordingly. If you work for somebody else, make sure you’re properly appreciated. They may actually be unable to pay you what you’re really worth at the moment because of the recession but, in that case, ask for more flexible working hours or something else in lieu.
Your savings
If at all possible, save a bit of money each month and put it in an interest-earning account, away from the funds you use for regular spending. I find that if I’ve got money in my current account, I spend it much more easily than if I’ve got to make a withdrawal from my savings account.
Keep up to date with interest rates and, if your savings are no longer in the most profitable account, move them. Banks rarely volunteer the information that you could be earning more by switching to a different arrangement but they do usually tell you if you specifically ask. And if you would benefit significantly from changing banks, do it. It doesn’t have to be difficult and, as consumers, we need to take advantage of capitalist principles of competition.
Remember what money is all about
While it’s important to respect money and not to spend loads of it you haven’t got, it’s also good to remember that, ultimately, it’s only money: a means to an end and not an end in itself. All that matters is having enough to live on, so money is not a constant worry. Beyond that, there are far, far more important things in life.