Start Now, Download Oval. App Store Google Play

Discover tips and tricks on how to save and invest money by Oval Money

And so it has come round again – one more year has come and gone and you are probably feeling like you blinked and missed it. Before all the well meaning resolutions roll round you should take a moment to take stock of the things you have done or should have done this year to improve your finances in order to give yourself a clearer picture of what you want out of 2019.

1.    Paid off your debt – or at least tried

This is your standard good advice and it goes for both short-term debt like credit cards, and longer-term debt like student loans.

Not only is being debt free good for your sanity, but it also impacts your credit rating. Furthermore, when you are not paying hundreds of pounds a month to cover debt payments, you free up that income to funnel into savings or investments.

2.    Added to your pension

Your pension matters; it matters a lot. And, whilst there are numerous opinions out there on what and how you should be saving in order to retire before you’re totally exsanguinated, all agree that it should definitely be a priority. There is no ‘get rich late’ alternative to starting young and saving throughout your life.

If you are still at a loss as to what you should be saving each month then the Government established website The Money Advice Service has a nifty pension calculator to help you figure it out.

3.    Saved money

On the topic of ‘get rich quick’ solutions, there is also no alternative for putting money aside into savings on a regular basis. Even automating only a small amount of savings each week soon adds up to a hefty amount.

Ideally you’ll have topped up your emergency (or safety net) fund that should stand at the equivalent of about 3-6 months of all your outgoing expenses. This is designed to cover you in case anything happens such as losing your job or long-term illness.

Then you should also have a short-term savings fund for separate expenses like holidays or car repairs. This will stop you dipping into your emergency fund and is useful for saving for short-term goals.

4.    Educated yourself

It’s common knowledge that we really aren’t taught enough financial education at school. As useful as it was to learn how to find the hypotenuse of a triangle, it would also have been helpful to learn about compound interest and credit ratings. Because of this educational oversight it’s up to you to learn the basics for yourself.

This includes not only how to create a budget or use a credit card, but also how and why to invest your money in different options.

It takes time and patience, and potentially some initial costs in order to speak to a financial advisor, but it is worth it in the end to be fully educated in all the different ways you can make your money grow.

5.    Learned to live below your means

Living below your means is a sure fire way of sticking to a budget. Not only does it mean you avoid being a slave of the paycheque-to-paycheque cycle; it also means you have income leftover to invest or save.

Learning to do this is a financial habit that will stand you in good stead throughout your life. Being able to prioritise your spending so that you do not exceed your income means that you will not be pulled into spending money on unnecessary items.

6.    Figured out what you want to do next

This doesn’t mean you need to have your whole life figured out. Rather, it means you have a clear idea of what you want to do in the next year. By doing this you will be able to set yourself a realistic budget. You will also have clear short-term savings goals that you can run in parallel to your long term ones – such as your pension.

If, for example, you are looking to get a new job you will know exactly what your new income will need to be in order to meet your ambitions. Alternatively, if you know you have a big event ahead such a wedding or a house purchase, then you will give yourself time to plan thoroughly and avoid last minute costs pushing you into expensive credit card debt.