Take time to review your finances

Scott Woods
Scott Woods

We all lead increasingly busy lives and taking time out to tackle our financial bad habits can seem tedious; somehow, it never quite gets to the top of our ‘to do’ list.

However, spending just a small amount of time thinking about our money and what we could do differently can help make the future more financially secure.

Not having an emergency fund - Everyone should have cash put by that could cover three to six months of living costs based on their current expense level. If you dip into this fund, remember to build it back up as soon as you can.

Not comparing costs - Expensive debt can end up eroding your wealth very quickly, so it pays to keep loans and mortgages under regular review. Credit cards can also come with high interest charges, so shopping around for good deals really pays.

Although it can seem time consuming, it’s important to compare costs for bank accounts, utilities, home insurance, phone and broadband.

Failing to plan - For many younger people, retirement can seem light years away. In many cases, people only think seriously about their later years when they have reached their peak earnings somewhere in their 40s.

Defining your goals, short, medium and long-term, will help you get a feel for how much you should be saving in your early years to make adequate provision for your future. Even small sums saved regularly can make a big difference.

Not keeping track of investments - It pays to review your savings and investments from time to time. That way, you won’t expose your money to unnecessary risks. Weeding out poorly-performing holdings and rebalancing the mix of assets you hold will help to keep your portfolio healthy.

The value of investments and the income they produce can fall as well as rise. You may get back less than you invested.