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Financial New Year’s Resolutions

Financial New Year’s Resolutions

Category: Money

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

It's that time of the year again: the presents have been unwrapped and the Christmas jumper folded away, and now all that's left is the hangover from the festivities. It's time to sit down and think hard about what you would like to change, and how.

People across the country are making resolutions, but forget faddy diets - sorting your finances out in 2017 would not only make your wallet happy, but can be a significant weight off your mind. Making some resolutions can set you on the road to a better financial future, so to start you off, we've gathered together some resolutions that could improve your money management and boost your savings.

This year I will…

…start saving more

If you have been worrying about the toll an unexpected expense could take on your budget and your bank balance, it's time to start building up an emergency fund. Saving can be tricky, especially when the purse strings have already been drawn tight, but putting aside even the smallest amounts can start to add up. An easy access savings account is the ideal place to build up an emergency stash as it allows you to access funds immediately should you need them. Check out our top easy access deals.

…save for next Christmas

Does Christmas come around each year and you wish that you'd put more aside to prepare? It may seem a little early to start thinking about Christmas 2017 – we're still recovering from the last one, after all – but it's never too early to get organised. "Putting just £50 a month into a regular savings account could put you on the path to covering your next Christmas spend," said Charlotte, finance expert at Moneyfacts, with even this small amount quickly adding up.

…pay off my credit card

Chances are that your credit card has taken a hit over the festive period, which means you may not be able to pay the balance in full when the statement arrives. But, a new year means a new start: to tackle your credit card debt, think about transferring the balance to a 0% interest balance transfer card. There are plenty to choose from, and as Charlotte points out, "with a record 43-month introductory term from MBNA available, borrowers can have even longer to pay off the balance without interest adding to it".

Once you've made your decision, all you need to do is to work out how much you need to pay each month to clear the balance before the interest-free period ends. To do this, divide the debt by the number of interest-free months, which will give you a minimum monthly payment.

Alternatively, it may be time to think about full on consolidation. "If you have a variety of debts on multiple credit cards, using an unsecured personal loan for debt consolidation could save a large amount of cash," said Charlotte. "For example, if you had £10,000 on credit cards at 18.9% APR and made a minimum payment of 1% plus interest or £180 (whichever is higher) each month, you would be charged £7,727 in interest and retain the debt for almost eight years. If you opt for the best loan rate instead, at 2.9% APR fixed for five years with Sainsbury's Bank, you would only pay £744.20 in interest."

…make my homeownership dream a reality

"If your big dream is to get on the housing ladder, a Help to Buy ISA is a great way to get you there," said Charlotte. "It's designed to increase the amount you're able to put towards your first home and provides extra incentive in the form of a top-up from the Government. With rates of up to 2.27% available, not only will savers benefit from the extra bonus, but they will also get some of the best rates on the market."

…boost my pension savings

Retirement may be a long way off, but it is never too early to start thinking about your retirement fund. If you have not yet enrolled in your company's pension scheme, do it! It's also a good idea to see if there is any way you could increase your contribution to give your pension pot a significant boost. If retirement is closer on the horizon, it may also be a good idea to start thinking about your options. Check out our annuity planner for ideas, and find out more about the pension freedoms (and their risks) to get started.

…fix my mortgage

"If you are currently sitting on your standard variable rate (SVR) or are coming to the end of a fixed rate deal, now is the perfect time to look for a better offer," said Charlotte. "Borrowers can benefit from some of the lowest deals on record, and they can potentially save a significant sum in the process. In fact, by opting for the average two-year fixed mortgage rate of 2.31% instead of staying on the average SVR of 4.62%, you would be £2,232.00 better off after just one year (based on a £200,000 borrowing amount over 25 years on a repayment only basis). By using the extra saved to overpay your mortgage you could also significantly reduce the length of your mortgage term."

…shop around for better deals

If energy prices and insurance costs are starting to rack up, it's time to shop around. Looking at all the options for cheaper deals could save you some money, so starting hunting so that you are ready to make the move when it is time to renew your policies or tariffs.

…switch my current account

Unfortunately, loyalty doesn't pay when it comes to your current account provider. So why not switch to a better one? "With some accounts offering switching incentives or credit interest of up to 5%, it's time to get something for nothing," said Charlotte. "Don't worry about switching though, as with the seven-day switch service, it's no hassle at all."

…get organised

Do you keep missing payments? Do you have no idea how much is in your bank account right now? Well, now is the perfect time to start taking charge of your money. Set up direct debits so that you never miss an important payment and make it a habit to check your bank balance regularly.

…be a savvier shopper

Taking advantage of vouchers can help cut the cost of your shopping. Cashback credit cards can also put some welcome funds back into your pocket, if handled responsibly, so check out what's on offer and whether you could benefit.

What next?

Instant access savings accounts (with bonus)

Compare the best balance transfer credit cards

Find an annuity

Compare insurance quotes

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.