Consistency and Money Habits: 8 Tips to Keep You On Track

When it comes to managing our finances, consistency is the golden key that sometimes seems just out of reach. It’s a familiar story for many of us - the month starts with a pledge to adhere strictly to our budget, and for the first fortnight, everything goes as planned. Then, as if on cue, things start to happen…

 Time distorts and for so many reasons we don’t have enough time to check our numbers.  It might be someone’s birthday so that “being special” throws caution to the wind and after a few drinks the card has been overworked.  The tyre on the car has a puncture which upsets the whole budget anyway as it was an unplanned event.  And then of course the temptation of emotional spending enters the scene, throwing all our good intentions out the window.  After all, we have had a rubbish day/week/month so we deserve a bit of a blowout.  The outcome?  Overdrawn and more on the credit card than you wanted – in fact, you had planned to pay it off this month.  Hey ho – let’s start again!  

 Commitment is easy when we’re enjoying the process, but it’s those unexpected desires and impulses that really test our resolve. It’s here that our consistency often gets hijacked. The road to financial stability is paved with good habits, and one of the most vital of those habits is consistency.

 To help you build a fortress of consistent and healthy money habits, I’ve compiled a list of 8 top tips that can keep you on track throughout the month, including leveraging the power of modern technology with apps like Money Dashboard and innovative banking solutions such as Starling. Let’s get into it:

 1. Embrace a Budgeting App

Money Dashboard is a fantastic tool that offers a crystal-clear view of your finances. Through the app, you can categorise your spending, set budgets, and even forecast your finances to help you stick to your financial goals consistently.  I have championed this app for years now and still do.  It works best with a spreadsheet which I call a money map rather than a budget (yucky word IMO).  Money Dashboard works brilliantly like a compass – helping you keep on course after you have mapped your money out giving every pound a purpose.  Check it daily while you are having a coffee

2. Divvy Up Your Savings

Consider opening an account with a bank like Starling, which allows you to create separate spaces for different savings goals. Be it Christmas shopping, an exciting holiday, or your car’s upcoming service - compartmentalising your savings can be a game-changer. Plan to do the divvying at the same time each month.

3. Start Small

You don't have to overhaul your entire financial system in a day. Start with small, manageable changes that you can maintain over time. The gradual approach makes the process less daunting and the habit easier to establish.  If you don’t know where to start, pick one category from Money Dashboard -e.g. Bills – check all the direct debits and standing orders for the last year for each of your bills – rent/mortgage, utilities, etc.  Know how much each is.  Tidy them up.  Just work on bills and ignore the rest until you have finished this bit.  Then move on to groceries for example.  I am sure you get the idea.

 4. Peace of Mind (POM) Fund

Life is full of surprises, and having a POM Fund – often called an emergency fund (I like to focus on what I want, not what I don’t) can be your financial cushion. Dedicate a space in your Starling account for emergency savings and contribute to it consistently.  When a bit has accrued, shift it to an account paying higher interest.  How much?  Aim for about 5 months of your essential living expenses.  The amount needed to keep the roof over your head, keep you warm, washed etc.  NOT the money that pays for Dominoes!

5. Schedule Regular Check-Ins

Rather than an ambitious once-a-month check-in, try reviewing your budget weekly to keep a close eye on your spending. Regular check-ins will help in adjusting your budget as needed, ensuring that you remain on track.

 6. Avoid Impulse Buying

Impulse buying is often the culprit behind budget derailment. Before making a purchase, give yourself a cooling-off period to evaluate whether you truly need the item. Do whatever it takes to avoid this – like freezing your credit card or putting it in your shoe when you go shopping.  Ideally, you want to sit with yourself and work out WHY you feel the need to impulse spend.  Money therapy will help with this.  Alternatively, let your mind wander whilst your thoughts are jotted down.  What comes up?  How do you heal from this?  What do you need?... to do, or feel etc.

 7. Reward Yourself

Setting aside a small portion of your budget for a personal treat can be a great motivator. It not only prevents burnout but also allows you to enjoy the fruits of your consistency.

8. Seek Financial Advice or Coaching

Don't be afraid to seek advice from financial experts – advisers or coaches depending on your needs. Sometimes, an external perspective can provide insights and solutions that we might overlook.

Conclusion

Remember, consistency in managing money isn't about perfection; it's about progression. It’s about building habits brick by brick until your financial house is solid and secure. Employing tools like Money Dashboard and the facilities offered by banks like Starling can be pivotal in maintaining financial consistency.

I encourage you to embrace the habit of consistency in your financial journey. As with all habits, it may take time to cultivate, but once entrenched, it will serve as the bedrock of your financial stability.

Until next time, here's to building consistent and healthy money habits, one step at a time!

Remember, the journey to financial stability is a gradual one, marked by consistent efforts and informed decisions. So take it one day at a time, leveraging the right tools and advice to foster a healthy relationship with money.

Good luck!

www.fannysnaith.com