5 steps to help get your finances in order

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At the end of 2020, when my work actually started to pick up again, I decided to stop all of my unneccessary, emotional spending, and instead focus on investing and saving money.

I work two jobs, and one of my jobs comes with housing, so my monthly expenses are basically non-existent. That means I can save a lot of money – which is great because I would like to buy a house in the next 2 to 3 years (and being self-employed, this will be difficult no matter what, so a large deposit will help!).

Cancel all email subscriptions

Subscription emails from stores make you buy things you don’t really need. The last two months, every time I received one, I immediately unsubscribed (trying very hard not to look at the deals they were trying to promote).

Set up an emergency fund

This one is important – just in case anything happens. I have about 4 to 5 months of living expenses (including rent that I don’t currently pay) in here.

Set yourself some goals

Now that you have that emergency fund, we can start talking about other savings.

We all know it’s important to put money in a savings account. But that doesn’t make it easy. Knowing all that money is just sitting there, unused, can be frustrating, especially when you run out of money by the end of the month. That’s why it’s important to set yourself some goals. What are you saving up for? Do you want to travel, buy a house, or a new car? Knowing that money is going to go towards something you really want, will make it easier to leave it in that savings account, instead of taking it out.

Start investing

Once I got that emergency fund back to where I wanted it to be, I started my payments to Moneybox again. Moneybox is an investment app where you can open different accounts. I currently have a stocks&shares ISA, a Lifetime ISA and a personal pension.

The Lifetime ISA gives you an extra £1000 from the government if you invest £4000 each tax year. This is a great boost if, like me, you’re saving up to buy. You can only access the money in a Lifetime ISA if you’re purchasing a house for the first time, or after you’ve reached pension age. If you withdraw early, you will lose the 20% government bonus.

A personal pension speaks for itself. Not having an employer, I have to save up for my pension myself.

A stocks&shares ISA gives you more freedom than a LISA, as you can withdraw the money at any time. But you don’t get the bonus. And, as with any investment, you can lose the money that you put in.

Every week, Moneybox automatically takes £50 out of my account and divides it between those three accounts. And every month, when I get paid for my translation work, I add 95% of that money (after taking out taxes) to my LISA as well.

If you sign up to Moneybox with my referral code 3CDUNR you get £5!

Download Plum

This app is a recent download, but I like that it tells me my bank account balance every day. And if there’s enough money in my account, it will take some out and put that in a savings account for me. I also have turned on round-ups, so that the money I spend is rounded up to the nearest pound, and added to my savings. That way, I don’t have to think about it!

And that’s what I’ve done in the last two months to get my finances in order. I keep track of everything in Excel, and update how much money I have in my different accounts once a month.

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8 Comments

  1. 25 February 2021 / 2:33 pm

    Those are some great points to keep in mind and I really need to start planning on investing.

  2. 25 February 2021 / 1:31 am

    I love the app idea! I have never heard of it before, does it work for US currency?

  3. 24 February 2021 / 4:10 pm

    When I had to save I did the same. Good tips.

  4. 24 February 2021 / 2:17 pm

    That Moneybox is a nice app, something that automatically saves for you. I wish we have that here.

  5. 24 February 2021 / 3:27 am

    Great tips! I haven’t heard of this app called Plum. Seems like a really good tool to keep everything in order. I also need to work on cancelling my email subscriptions. You’re so right on this!

  6. Lyosha Varezhkina
    23 February 2021 / 7:40 pm

    very useful and working basic steps. Finances are never easy to keep up with but it is crucial to

  7. 23 February 2021 / 6:13 pm

    This is so true when it comes to cancelling all subscriptions. Add unfollow all shopping sites and social platforms.

  8. 23 February 2021 / 5:51 pm

    These are great tips. We are buying our home so we have a lot of outgoings but recently I have been keeping my finances on track. My main downfall is buying clothes and earrings (although I buy cheap or second hand, I buy lots)

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