Practical Tips to Improve Your Finances


You might think the only way to improve your financial situation is to earn more money. That would be grand, of course, but another way is to manage what you have more effectively. 

And that doesn’t necessarily mean cutting back on the nice things in life. You can make smarter choices in lots of different areas when you know exactly where money is going.

Here’s how to start being the boss of money today:

Track Spending

It’s often the little spends that mount up behind your back. You’re just having a coffee with friends every day, for instance, but that can easily mount up to £50 or more every month.

Devising a simple balance sheet where you can keep track of expenses will help you understand where money is going, and it’s very easy to do.

On a page in a notebook, make five columns and give them these headers starting from the left: Date, Item, Income, Cost, Balance.

This is what you’ll write in the space underneath each column:

  1. Date – when you bought the item.
  2. Item – what you bought.
  3. Income – the amount of any money coming in.
  4. Cost – what you paid for the item.
  5. Balance – at the very top of this column write the amount of money currently in your bank account. When you fill in other columns through the month, update this balance column by either adding or subtracting the income or cost amount.

The other thing to remember to add to your records is direct debits. Leaving these off can mean you end up with a misleading balance, so check the dates they go out and the costs on your bank statement.

You can start a new page every week or every month, depending on how many transactions you have. Just transfer the balance from the bottom of the old one to the top of the new one so you have a fresh opening balance to work from.

Once you start keeping track of your money, it can become quite fun, and you’ll find new ways to use the figures to help you be more mindful about spending and saving. You don’t need to be an accountant to find money and how to control it fascinating, but the more you know the more control you can gain. Learning about accounting is easy through courses all over the island of Ireland, both ROI and NI.

Manage Your Receipts

Businesses need to keep receipts on file for tax and legal purposes. Individuals don’t need to keep hold of them after the particulars are safely recorded in your spend and save records as outlined above. 

So, keeping simple but accurate records also means you can say goodbye to a growing pile of old purchase receipts in the bottom of a handbag or kitchen drawer. Only keep the ones you need to prove a purchase for a guarantee, warranty, or return.

Put Yourself in Control

After a couple of months or so of keeping spending and income records, you’ll have built up a valuable resource you can start putting to use.

Incidentally, just by looking at your own finances in this way you’re building up real life accounting experience without too much effort.

Using your records, you can start digging into where money is going. Look at all the different categories of spending you’ve recorded in the ‘item’ column. You may have clothes, cinema, groceries, make-up, toys, meals out or magazine subscriptions on top of general household bills. There are hundreds of different items we spend money on without even thinking about it.

By totting up how much each category is costing each month, you can make informed choices about cutting back if necessary and know exactly what difference that cut back would make to your expenses.

If you’re trying to save for a special event, or maybe find a bit extra to pay off a credit card a bit quicker, you can look at your detailed spending list and figure out how to move money around to achieve what you’re aiming for.

It also means you can make wiser choices about where and by how much you’re willing to reduce spending. It’s a far less painful method than just randomly opting to stop doing something you enjoy.

The hardest part is setting up this system to start with. After that, it’s plain sailing and you can look forward to the satisfaction of knowing you’re the one in control of money.

Photo by Karolina Grabowska from Pexels

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