Keeping track of the pennies

Your home finances often seem complex and often don’t have a great paper trail either. This coupled with the reluctance that a lot of people (me included) have to look at where we actually fritter our money away to, can lead to a lot of potential problems. For example, I know people on £80,000 to £100,000 who think they’re hard up and don’t ever seem to have any spare cash knocking about. Of course some of it is about lifestyle expectations but I also know people who pay out £120 a month for joint gym membership and have done for years now without ever actually attending outside of the induction. Of course, given the age I am (rapidly approaching 40 next month, with all the dread and expectation that entails), we’ve been fortunate to be home owners for the last ten or 11 years. But I do remember what it was like when we were trying to scrape together the deposit for our first place. If you’re thinking of saving up for a home of your own but aren’t sure if it will be cheaper than renting, you can take a look at TSB’s mortgage repayment calculator to see how much your repayments would be.

We might not be saving up for a deposit on a house but our personal circumstances have certainly changed since we bought our first house. We now have 3 more children than we originally had and one less full time job between us. If we want something, we have to save up for it because neither of us believe in the slippery slope of credit cards. When we had our house’s original 1968 vintage (and not vintage in a Kirsty Allsop way either) bathroom refitted, it was after we’d basically stopped going out for six months and had stopped the old vino and beers.

Sitting down and working through your regular outgoings is part of the path to understanding what you spend your money on, which is a key part of streamlining your expenses so you have more money in your pocket to spend on the things that are important to you.

There are many things you might find out if you look to examine your personal finances. you might find:

  • direct debits for services you no longer use or thought you had cancelled;
  • small regular payments for a service or goods that add up to something much higher than you had anticipated;
  • you’re not being paid what you ought to be for some reason that you’ve never checked;
  • interest charges mounting up.

The list could be endless and exceedingly varied/idiosyncratic but the real point is you won’t know until you look at it and you won’t be able to get some sort of control on what you’re spending against what you’re earning until you’ve done a proper analysis.

In terms of actually saving money though, there are definitely a few things that I pulled out from looking at our bank statements. Suffice to say once I added up our mobile phone monthly tarrifs and multiplied them by 12, we weren’t on those contracts for very much longer! One of the other things I did was to look at how much we were spending on train tickets at the weekends and made the decision to buy a family railcard. Three trips later and it’s already more than paid for itself. We’re keen on doing that sort of thing- a bit of an initial outlay for less expense in the long run.

So there you go, a few pointers from me, how would you start?

Disclaimer: This is a sponsored post.