February 1st 2018

Taking control of our personal finances is a resolution that is definitely worth keeping this year. Kenny Logan provides you with 10 top tips on how to make more of your money, all it will cost you is a bit of time and effort.

If you resolved to get fit, learn a new skill, quit drinking or to eat healthily as part a New Year’s resolution, unfortunately the odds of success are stacked against you! On average we spend around £187 each on resolutions that we quickly give up and by the second week in February more than 80% of these resolutions are already broken.
Kenneth Logan, JRW Edinburgh Office

Making a New Year’s resolution is one of those things that seem like a great idea at the time but are incredibly hard to keep. So, on a more positive note we thought it would be a good idea to take a look at our personal finances and see where you can cut back and make some long lasting savings. This is definitely a resolution worth keeping and once you’ve done it the rewards will stay with you – unlike the gym membership!

Build a cushion
Try to create a pot of savings that will help with those nasty surprises which happen when you least expect them. The aim would be to have around a £1,000 pot for each adult in the household.

Set up a direct debit
Try setting up a direct debit to invest a little every month but avoid putting all your eggs in one basket.

Work out your goals
You should work out what you want to do with your money this year and set goals – whether that’s helping the children, saving up for a holiday or buying a new car. If you have a clear goal then you know what your priorities are and what you are working towards.

Go compare!
Get out your utility bills, car, household and travel insurance policies as well as for your mobile, landline, broadband and digital TV subscriptions. They represent a large amount of your income and you could make enormous savings by haggling with your existing suppliers and if that doesn’t work then you should switch. Don’t put this off any longer.

Clear your credit
If you ran up a credit card debt over Christmas, you should consider shifting it to a balance transfer card if you qualify. If you already have a zero per cent credit card, make a note of when it comes to an end and be prepared to change. You should of course try to keep borrowing to an absolute minimum and if you do need to borrow look at cheaper borrowing such as a bank loan.

Diary it in
Keep a calendar of your major commitments for the year ahead – mapping out big events and expenditures can help you plan and budget for them in advance.

Reward your loyalty
Make sure that you redeem your rewards, loyalty points and cashback on promotions. An average of £60 per person can be saved in this way.

Savings accounts
Shop around for a better savings account – one which pays a consistent and a fair rate. Don’t just do what you’ve always done.

Take a break!
Everyone should make the most of their annual tax allowances before 5th April. There is tax relief on pension contributions of up to 100% of your salary, or a maximum £40,000 and you can invest up to £20,000 in Isa’s, held in cash or equities.

You can also reduce your inheritance tax exposure with careful gifting each year.

Not to mention the Marriage Allowance – if one spouse earns less than the personal allowance, currently £11,500, they can transfer £1150 of their allowance to their partner, saving up to £230 if eligible.

Keep it real
As with New Year’s Resolutions do not set overly ambitious targets as you will quickly become demoralised if you can’t meet them. Set achievable goals and stick to them over time.

We would strongly recommend that this is the year that you take a bit of time to look at your personal finances. You would be absolutely amazed at the results that these simple steps can make, giving you more money for the things that are important to you.

JRW Chartered accountants in Edinburgh, Galashiels, Hawick, Langholm and Peebles.