8 tips for managing your money

Lisa Conway-Hughes, financial advisor and author of Money Lessons, shares her eight top tips for taking care of your money, so that it takes care of you.

Money Lessons author Lisa Conway-Hughes
Money Lessons author Lisa Conway-Hughes

The idea of 'wellbeing' has been on our radar for quite a few years now, however financial wellbeing is very rarely discussed. It is very British not to talk about money and as a nation we are known to bottle up problems especially financial ones.

Stress causes 40% of work-related illnesses according to the HSE and a 2018 PWC report shows that money is one of the things that we worry about the most of all. So are you worried sick about money? Or perhaps you are at the other end of the spectrum and are blissfully unaware?

For most people financial wellness is the freedom from financial stress (debt worries and stress of unexpected expenses) and also the freedom to have choices. How differently would you feel with a nice nest egg squirrelled away? Would you sleep better at night knowing that you are doing what you should be doing for your retirement. What would you do differently if you knew you were working because you wanted to rather than because you had to?

The good news is that you don’t need to have been born with a silver spoon in your mouth to achieve financial wellness. Here are a few easy tips to help you to start managing your money, so that it goes further and so you can enjoy lifelong financial health. 

1. Do a budget planner

The foundation to a great financial plan is to know what you have coming in and out each month. It will also help you plan monthly for annual expenditure (birthdays/Christmas/holidays) so that they don’t creep up on you. 

2. Keep an eye on your outgoings

Each September set aside 30 – 60 minutes to make sure that you are not over paying for anything. Can you negotiate better deals on your gas, electricity, mobile phone bill and are you really using all the subscriptions that you have signed up to? 

3. Join your work pension scheme

Join your work pension scheme as soon as you can and opt for the maximum employer contribution where possible. A rough guide is that you should be paying in half your age as a percentage of your salary into a pension. So if you are 30 you should be paying in 15% of your income into a pension. If you are 40, you should be paying in 20% etc.

4. Start a pension if you're self-employed

If you are self-employed – start a pension for yourself as soon as you can. Research by Professional Adviser magazine found that 45% of self-employed people do not have a pension. By not having a pension, you are missing out on tax relief.

5. Consider investing

If you have extra money that you know that you don’t need to spend for at least 5 years, then consider investing. As you would with your savings, start by saving money out of each pay packet the day you get paid by setting up a direct debit.  Most importantly, when markets fall, don’t freak out! If you have picked an investment for the right reasons, now is NOT the time to be selling your investment

6. Allow time to get a good mortgage deal

Set a reminder in your diary 3 months before your mortgage deal expires. This will give you sufficient time to get a mortgage broker to shop around for the best deal for you. On the subject of mortgages, it is important that you also make sure that your mortgage will be paid off before you would like to retire. If your mortgage term is too long, you may wish to consider overpaying your mortgage if you are allowed to.

7. Protect your income

Protect yourself. If you don’t have an income protection policy at work or you are self-employed you might want to consider protecting your income with your own income protection policy. This policy will pay you a tax free monthly amount if you are not able to work because of ill health or injury.

8. Get a money friend

Break that British taboo and get a money friend. This is someone that you are financially accountable to. This person knows you inside and out financially and together you can set goals and help each other to work towards them.

Good luck with working towards financial wellness. Tackling just a few of these things will help you to gradually improve your money mind-set over time.

Money Lessons by Lisa Conway-Hughes is out now.


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