Monday, November 14, 2016

Financial Tips for UK Families

Financial Tips for UK Families
Money may not be everything, but most U.K. residents will agree that it is important for peace of mind, security and overall well-being. Parents in the United Kingdom often feel stressed or anxious about their financial situation, and this is because it often seems like there is not enough money available regardless of your level of income. While this is a common sentiment, the good news is that there are steps that you can take to improve your financial situation.

Create a Realistic Budget

If you are like most U.K. residents, you may have repeatedly heard about the importance of a budget over the course of your life, and there is good reason for this. A budget tells you how much money you have available to spend on regular expenses as well as entertainment and other extras. It also can help you to better plan for savings so that you meet your future financial goals. The key to creating a functional and beneficial budget is to make it realistic, and this means that you need to include all of your expenses in it. This includes your regular monthly expenses, quarterly expenses and even major one-time expenses that you know are looming in your future. A budget can change on a monthly basis because of non-recurring expenses, so it is important to review your monthly budget on a regular basis.

Make Savings Automatic

One of the keys to overall financial security is having money in the bank, but many people find it difficult to save for the future. With a budget prepared, you may be able to identify sources of additional money that can be applied toward your savings account. For example, you may set a firm entertainment expense of a modest amount to control your extra spending, and you can use extra money that you save for retirement. When you have a monthly amount available for savings, the next step to take is to make savings automatic. You can do this by setting up an automatic transfer with your bank on a weekly, biweekly or monthly basis. When savings is automatic, you do not need to worry about forgetting to set money aside.

Plan for the Future

If you are like many residents in the United Kingdom, you may be woefully unprepared for the future from a financial standpoint. The future will inevitably become the present, and there will come a time when you need money for major illness, retirement and more. It is helpful to create a list of major expenses in your future, even if they are decades away. Assign a specific value to these expenses, and prepare your budget so that you regularly contribute money toward these expenses. Without taking this step, you may find yourself financially unprepared when the future does turn into the present.

As you can see, there are some realistic and simple steps that you can take to prepare for the future. Financial planning can seem like a daunting step to take initially, but you will find that these efforts taken now will indeed help you to enjoy a better financial future.

David Milberg is a credit analyst in NYC.

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