Today is the date known in the media as "Blue Monday" – the time of the year at which the average person is supposedly at their unhappiest.
It’s the point at which the days are still short, the weather gloomy and cold, and the afterglow of Christmas and New Year has dissipated. To make matters worse, around now is when many of us will be most concerned about our financial situation.
Feeling the financial hangover of the festive season
This is in no small part due to the impact the festive season had on our spending patterns and the fact that December’s credit card bills are due to arrive over the next 10 days or so.
But with the year ahead of us, January is also a sensible time to focus on how we can sort out our money matters, and try to ensure that next year’s Blue Monday isn’t quite as depressing as usual.
New Year resolutions
When it comes to dealing with your finances, there’s no magic wand you can wave to make everything OK – but there are a number of fairly simple steps you can take to get yourself on the right track.
1. Put yourself in the picture
Many of us bury our heads in the sand when it comes to dealing with money, especially when things aren’t going well. Of course it’s no fun to dwell on problems, but ignoring them can make things worse in future.
Regardless of your financial health, it’s worth looking at what money you have coming in and going out each month: if the latter exceeds the former, you could have difficulties ahead.
Analysing your spending also gives you the chance to see where you could cut back or where money is being wasted.
2. Be smart with debt
Debt repayments and interest can be a big drain on your resources, so work out what your most expensive debts are and deal with them first. This might be by increasing the amount you repay, or by shifting to a cheaper form of credit if possible. Zopa’s debt repayment calculator can help you see what you stand to gain from such a move.
3. Get into the right habits
Being good with money is as much about adopting positive financial habits as anything else. Putting aside some cash each month if at all possible is a decent place to start – this could be just as a rainy-day fund, or for more specific goals such as a wedding or retirement.
If your company offers a pension scheme, it can be well worth joining – although it will reduce your take-home pay, you should get some free cash from your employer as well to soften the blow.
And when it comes to the like of your mortgage, various types of insurance, or utilities, get into the habit of shopping around whenever you can for a cheaper, more suitable deal. Financial companies rely on customers’ inertia to generate a big chunk of their profits.
4. Make your money work for you
The same applies to the returns you are making on your savings or investments. Many banks offer attractive looking rates to lure new customers in, only to cut them almost to zero a few months later. Check how much interest your money is earning and then look at the alternatives: chances are you can do much better elsewhere.