How to get better with money!?

[testingtesting321]

Help!

I need some pointers as to how I can get more organised with my finances.

The question has come about because I have just checked my credit card app (I foolishly have the DD on minimum payments) and I have paid £80 in interest this month! I'm appalled at myself that I haven't got on top of it and pain more attention - first to the amount of interest that I pay on that card (the balance of the credit card is only about £2000 so the amount of interest in one month seems huge) and also that I haven't checked it regularly to see what's going on and how much I owe.

I feel really disorganised and although I earn a reasonable amount and have savings, I just feel I need to be better and be able to teach my kids better ways to be managing money.

Where do I start?!

Start by tracking everything. You can do that using a notebook, spreadsheet, budgeting software like YNAB. Once you get in the habit of recording every penny you spend then you will start to realise in which categories, such as food, drinks whilst out, take aways, you over spend.

Make an xl spreadsheet.
Start with bills, so mortgage, electric, gas, water, tv licence, car insurance.
Put everything on there. Netflix, internet, the lottery.
Then add it up.
If you can, put when they all come out.

Then, your debts.
Add them up.

Then, your oncomings.
Take off bills.
Then, food weekly and travel weekly.
Get your leftover cash.

Put a bit aside for emergencies and to build up savings.
Pay off debts.

That's how we do it.
Scary at first, but you need all the reins of your life safely held in your hands.

Lot not lottery!

The money saving expert spreadsheet is great. It helps you plan for annual costs too, not just minty ones. I can also recommend swapping your current account to Starling. It helps you to keep track of what you’re spending and where but the best thing for me is their saving spaces. They are like mini accounts within your main account that you can make savings to for things like Christmas etc.

Can you swap your credit card to a 0% one?

Get a Monzo card - it tracks how much you spend on certain categories (groceries, shopping, bills, eating out).

You can set limits and it will alert you when you're close.

You can make savings pots that it automatically puts money in.

You can set goals and parameters.

And stop using a credit card until you know you are able to responsibly.

Definitely see if you wan switch to a 0% interest rate credit card and do a balance transfer.

Money saving expert website by Martin Lewis is really great for this.

It very easy to build up £2000 debt. Some fab advice already.

Here's what worked for me and I hope it helps you make some changes of your own. Assuming you have no unnecessary gym contracts, insurances etc as I did. so check and cancel all unnecessary DD

Budget is key here, tracking and multiple accounts.

I have three accounts. Salary, Direct Debit (bills) and spending.

I pay my salary into a savings account and them pay the direct debit account the exact amount them my Starling account I put in £400 allowance for spending, food, petrol, clothes, gifts, pets, household, health and beauty EVERYTHING. I work out allowances for each of these categories e.g gifts is £25 a month, petrol is £60.

This leaves the residual to be building up i'm my salary account for big one offs such as holidays, christmas, car service, birthdays and of course some of this residual should go towards your CC debt.

I write down every individual purchase (excepting the weekly shop) from my starling account in an excel spreadsheet. I photograph the receipts or the purchase themselves and attach this the transaction on the starling app. I then created some categories e.g gifts, petrol/travel, clothes, eating out, entertainment. I then created a pivot table (very geeky) to find out which category has the most spending. This was my own blundered method! Not scientific but worked.

This year I thought about what I would need over, say £100. For example a new phone, big birthday, car service, holidays, mini breaks, big days out, Christmas, blinds, new light fittings, decorating. And wrote a list

Yes it is very time consuming (and sounds dull as) but I have done this for two whole years, saved thousands of pounds, gone part time at work and ordered a new car and bought a new iPhone 12 having saved up for it!

I don't track everything now-only if i go over my £400 to find out why. Also next year it will be £450

Also consider moving the debt to another card and set up a standing order (or a loan) that has lower % as long as you destroy the old card.

The question has come about because I have just checked my credit card app (I foolishly have the DD on minimum payments) and I have paid £80 in interest this month

If you want to be even more appalled, compare the minimum payment to the interest, most of the minimum payment goes on interest and a tiny tiny amount on repaying the debt. Leave it like that and it takes decades to pay off.

Make Moneysavingexpert your friend. If you go through their money makeover, you'll get help with that credit card debt - transfer the balance to an interest free offer and pay it off in the interest free period plus minimising all your other expenses, save money on things you buy by shopping around and using discount codes and maximise income by getting money for changing your bank account or using cashback websites.

All these little things add up to having a lot more spare money each month. Also get the weekly email to get ongoing tips about being better with money over time.

www.moneysavingexpert.com/family/money-help/

There used to be an excellent poster on these boards who worked in finance I think. Her top tip was to change the direct debit into a standing order for a tiny amount more than you payed this month ( or a bigger amount if you can obviously) then stop using the card. You end up paying more of the actual amount owed and so less interest accrued.
This way you still have access to a card for proper emergencies.

Hi OP
I got myself into a total mess with debt in my 20s. I cleared mine with a total dedication and probably cost me my relationship at the time but lesson learned
This website has excellent resources but this is the article that stayed with me the most

www.mrmoneymustache.com/2012/04/18/news-flash-your-debt-is-an-emergency/

Thanks so much for all this advice. I have bookmarked MSE and am starting to work through the sections on there. I will apply for a 0% credit card and move the debt over to that asap. I will keep the old card for emergencies - I know that may seem a silly idea but I've had the card for ages so I've built up a high credit limit so will keep it very much as a just in case card.

@cherrypiepie I think the idea of 3 accounts for different things is excellent. I like to have things separated so might well give this a try.

Will also get the spreadsheet started as has been suggested by several people.

Thanks so much all!

@testingtesting321

Good luck! I highly recommend starling account for spending and saving pots for Christmas, birthdays, etc

I actually took out a loan to consolidatedebts.