Spark joy with your finances
If you’ve recently been folding, sorting and questioning the things that you own, you too have discovered the joy of a minimalist lifestyle.
It’s no wonder that with wardrobes packed full of last season’s clothes (and the season before); tidying up and decluttering has become a new obsession.
While organising every part of your home gives you a winning feeling, could you use the same approach to neaten your finances? We say, yes you can.
Here’s how you can tidy up your finances:
Organise your accounts
Managing your spending and saving can sometimes feel messy, but multiple accounts can be a great way to organise your funds, and handle your day-to-day spending.
Your spending
Your everyday spending can be managed using a transaction account. They almost always come with a debit card allowing you to withdraw cash, set-up regular payments as well as tap and pay when you’re out and about.
Most people get their salary paid into this account and simply transfer their savings into a savings account each month. Elizabeth Warren, a Bankruptcy expert suggested that depositing 20% of your salary or pay into your saving account is a great way to achieve your savings goals.
Your saving
If you’re saving, you’ll certainly know the feeling from seeing your savings grow. To help you feel joyful more often with your savings, simple follow these tips:
Many people don’t have just one savings goal, there may be a long-term goal to save for a house deposit and a short term savings goal for that European holiday. A great way you can keep track of your savings and keep your goal front of mind is by creating two separate savings accounts and naming the accounts after your goals.
Neaten and categorise your money
Now that you’ve spruced your savings, you can also get your monthly budget in-line.
Handy budget calculators can help you to work out how much money you have, and where you’re spending it each month. Look at your transaction history for the past month to work out where you’re spending your money.
Think about your outgoings such as:
- Rent
- Monthly bills
- Insurance and medical costs
- Transport
- Car costs
- Food shopping
- Lifestyle
Once you have these costs, deduct these along with your savings payments, and Voila you now have your monthly budget. This is when you can look at your overall spending and work out if there are some things you can reduce your spending on so that you can reach your savings goals sooner.
De-clutter and get specific with your goals
Your accounts and goals may be set-up and organised, but every good goal needs a plan.
The first step, is to know when you want to achieve each goal. While some are long-term, some can be reached sooner, and organising your time frames allows you to plan how much you need to set aside.
Tidy-up your spending
Finally, when your finances are as organised as a perfectly folded wardrobe, you don’t want to be cluttering either up again. The best way to achieve this is to reduce your spending.
Stick to your list
Before you hit the shops, try and put together a list to keep you on track with your spending. Meal planning before a big food shop may help you reign in any food cravings on the way around, and helps you to minimise any leftovers at the end of the week.
Don’t stray with sales
Even the best list-maker can stray slightly when the sales are on. It may be tough, but even those new season shoes at 20% off, aren’t a bargain if you don’t need them.
If you spot something that you want when you’re out and about, make sure you’re not impulse purchasing by thinking it over for at least a day. You don’t want it to be on the ‘no’ pile two months later.
Finally, with a new de-cluttered account set up and some streamlined savings plans in place, you’ll have finances you can be proud of.
Source: ING, March 2019
