Category: Money Savings Tips

Why you Should Drive and Old Car and Pay of Your Mortgage Early

Save Hundreds on Rent Per Month By Becoming a Property Guardian

4 Obstacles you Will Face on Your Financial Journey

My aim with each blog post is to help you move to a better financial future. I believe that there is not enough financial education in the national curriculum and I intend to share anything helpful that I have learned along the way. I am by no means a financial expert. None of the information on this website constitutes financial advice and is provided as general information only. This is my personal finance blog; my marketing blog is over here and I have been blogging there since 2010. I hope you have found this information useful. Thank you for reading.

Best regards,

Mike

Save Money by Switching Energy Supplier Every Year

Does Your Choice of Supermarket Matter?

This post may contain affiliate links please read our disclosure for more info.

Image credit: http://www.goodhousekeeping.co.uk/

Groceries are a necessity for life but it must be remembered that not all supermarkets are created equal in terms of value for money. Convenience is also an important factor when it comes to selecting a supermarket; you are more likely to shop at a supermarket that is easy for you to get to, particularly if you plan on going there on foot. If you are driving you’ll pick a supermarket with a car park over one that requires you to find an available parking meter. This is an entirely natural way of choosing a supermarket and is to be expected. However, if you have financial goals to achieve you should recognise that your choice of supermarket is a huge opportunity to make regular savings and achieve your financial goals more quickly.

Supermarket Choice

Luckily for us we don’t have to guess which is the cheapest supermarket. Food retailer trade magazine, The Grocer regularly conducts secret shopper research to confirm where you should go to buy the cheapest groceries. According to their data, Aldi is the cheapest supermarket. When you click on the link in red text you will see that they have compared supermarkets for a range of everyday items and Aldi has come out on top because the basket of items wash cheapest there.

What Should you do?

If you have an Aldi near where you live, choose Aldi for your grocery shopping from now on. If there is not an Aldi near you, choose Asda because Asda was number two on the list. At the risk of sounding like a grocery shopping geek, when I made this change to my regular choice of supermarket I was saving 30-40% on my regular items when compared to Tesco, for example. I did have to change my routine to make this change, I had to drive slightly further to visit the nearest Aldi but even when I factored the additional petrol cost, Aldi was still a clear winner. The change I made was not a big deal and amounted to an extra five minutes in the car.

In an earlier post on this blog I asked the question, Do you have the Right Money Mindset? Small behavioural changes like driving a bit further to a cheaper supermarket can create more abundance in your life. It is so simple to do and yet most people do not do it. Instead the continue to shop at the most conveniently located supermarket despite the fact that it costs them more. Which type of consumer do you want to be? A frugal one who is intentional about their purchasing decisions or someone who regularly spends more than they need to on groceries?

Have you changed your choice of supermarket to take advantage of lower prices? If so, what has the money that you saved allowed you to do? Please let me know in the comments section below.

If you have enjoyed this post you will also like the following posts:

How to Stop Impulse Buying – 10 Ways

Why you Should Drive and Old Car and Pay of Your Mortgage Early

Save Hundreds on Rent Per Month By Becoming a Property Guardian

4 Obstacles you Will Face on Your Financial Journey

Best regards,

Mike

How to Stop Impulse Buying – 10 Ways

Save Money By Switching Energy Supplier Every Year

This post may contain affiliate links please read our disclosure for more info.

Image credit: https://banglamirrornews.com

For most people, the prospect of assessing the best deals amongst energy suppliers is not exciting. It is necessary for us to choose a supplier for electricity and gas but I imagine most people spend as little time as possible thinking about it. This is exactly what the large energy suppliers want us to do, of course. Their strategy is to capitalise on our inertia or lack of interest to keep us as customers when we would be better off finding a great deal with one of their competitors.

Switching Energy Suppliers

Typically what happens is this, we are attracted by a good 12 month deal advertised online and sign up for it. When the initial 12 months are over, we have become accustomed to logging in to a particular account and receiving communication from one company. As the renewal date approached our existing supplier offers us a chance to renew with their ‘best offer’ for you. In most cases, this best offer is not a good deal and the price will rise if you accept it. Many people do accept it because it seems convenient.

What Should you do?

When you receive your pending renewal communication from your existing supplier, make a note of amount of your current direct debit and energy usage for electricity and/or gas and visit a comparison website. I went through this process yesterday, as I do each year, the website I used for comparison is called uSwitch, you could also try moneysupermarket.com. Allow yourself around 10 minutes to input some details about your existing supplier and contract and then the website will present you with the best choices for your energy supply and you can select one. My selection of new supplier meant that I will save £110 on my energy usage over the next 12 months.

Most people I have spoken to about this are aware of these websites but do not make a habit of visiting them each year. This is exactly what you should do to the best value for money deals. The same also applies for other categories including car insurance and home insurance.

The comparison websites I have highlighted are based in the UK because I live in the UK. If you live in another part of the world please use similar comparison websites to achieve the same results. I would be interested to know some of those websites and which country they relate to, you can let me know in the comments section below. Also, have you recently changed energy supplier? Let me know below.

If you have enjoyed this post you will also like the following posts:

Why you Should Drive and Old Car and Pay of Your Mortgage Early

Save Hundreds on Rent Per Month By Becoming a Property Guardian

4 Obstacles you Will Face on Your Financial Journey

Best regards,

Mike

How to Stop Impulse Buying – 10 Ways

This post may contain affiliate links please read our disclosure for more info.

Image credit: https://lavareviews.com/

According to research conducted in 2016, 54% of Britons admit to making an impulse purchase every time they go shopping. Impulse buying is a big problem that results in many losing control of their financial affairs and failing to stick to their budget. Consumers impulse buy both in-store and online, with in-store customers being more susceptible to impulse purchases. Retailers have accumulated their own data and design their stores to encourage buying on impulse; the more this happens, the greater the profits for them. What can we do to eradicate impulse purchases from our monthly expenditure? I have listed some very effective ways below.

Impulse Buying

Keep a Budget

Once you have identified your financial goals, the best method to move forward towards achieving your goals is to keep a monthly budget. If you have not already set up a budget, this post will help you, How to Create a Budget That you can Stick To. Budgets make you become more intentional about all of your expenditure and leave little room for impulse buys. Ensure that you look at your budget frequently; be disciplined and you should be able to resist impulse purchases.

Follow a Cash Budget

One step up from a regular monthly budget is a cash budget, following a cash budget will give you further daily reminders of what you intend your cash to be used for. Resist the temptation to take from one of your envelopes to fund an impulse purchase. Stay focused.

Keep a Spending Diary

For a period of a month, write down every purchase you make, there is no need to include bills. Be accurate and include morning coffees and snacks etc. After the month is over analyse your spending to identify any weak areas. Are there regular times when you are more prone to impulse buys? Is it when you are bored? Have you looked around shops during your lunch hour and succumbed to a purchase?

Work out Why you Impulse Buy

What are the circumstances that lead to impulse purchases in your life? Is it when you are feeling a bit low? Or lonely? When you have received some bad news? Or had a particularly tough day at work? Perhaps after you’ve had an argument with your partner? Only you will know the answers to these questions. If you need to talk to someone confidentially about the amount of impulse purchases you are making you can contact The National Debtline or Citizens Advice. Click on the words to be taken to their websites.

Make a List Before you Shop

Make a list of items that you intend to buy before shopping online or in-store. Use retailers websites to get a good understanding of where you can buy the items you need and the best prices for those items. If you can purchase cheaply online, do so. For some items, fruit and vegetables are a good example, it may make sense to visit a store and then make you planned purchases. Having a physical list will help keep you on track and avoid impulse buys .

Introduce a 48 Hour Rule

If you spot something that you would like to buy, but it is not a planned purchase, force yourself to wait 48 hours before purchasing it. This is assuming that you can afford to buy the item and will not have to use money that is already allocated for something else. The self imposed 48 hour ‘cooling off ‘period will allow you time to think about whether you really should make the purchase. Take the time to think about whether you need or only want the purchase. Realistically how much would you use the new item?

Don’t Set up One Click Ordering

Do not set up one click ordering on websites, websites offer this convenience because they know that it will result in more sales for them and increased profits. We have all been in the situation where we are about to leave a website and are then presented with a ‘special offer’ that we can order with one click. This ‘convenience’ can prove very inconvenient when it comes time to reconcile our budget.

Do Not Browse

Do not browse in shopping centres or on retailer websites, only visit if you have something specific to buy. This simple step will cut down the amount of temptation that you face.

Do not Routinely Carry all of Your Credit cards

Carrying all of your credit cards in your wallet or purse every day increases the chance that you will make an impulse buy. This is because the increased access to funds can prove a very strong temptation to many. Leaving them at home in a safe place is much better approach if you are trying to curb impulse purchases.

Convert Your Potential Purchase into Hours of Work

Think about how long it takes to earn enough money to purchase the item, if you earn £30 per hour and you are considering a new pair of shoes for £150 consider whether they are really worth 5 hours of work. How many pairs of shoes have you got already? If your money is limited, also consider the opportunity cost of the shoes. In other words, what will you have to sacrifice in order to be able to buy the shoes.

You don’t have to implement all of these methods to eradicate impulse purchases. Think of this list as a menu and pick those tactics that will be most effective for you.

Monitor your own progress in the weeks ahead. Do you have a problem with impulse buying? Let me know in the comments section below.

If you have enjoyed this post you will also like the following posts:

Why you Should Drive and Old Car and Pay of Your Mortgage Early

Save Hundreds on Rent Per Month By Becoming a Property Guardian

4 Obstacles you Will Face on Your Financial Journey

Best regards,

Mike

Why You Should Drive an Old Car and Pay off Your Mortgage Early

This post may contain affiliate links please read our disclosure for more info.

Image credit: https://cars.usnews.com / Car pictured is a 2007 Honda Accord

I get it. Most of us like nice things, especially nice shiny new things that get us from A to B. There is no denying that driving a brand new car sends a signal to the world that we are on the right track and can make us feel good about ourselves, but at what cost? Car payments are often the second or third largest items of expenditure on most people’s monthly household budget. If you are serious about pursuing financial freedom you will need to stop making ego-driven financial decisions.

I have noticed something, lots of people with immense wealth drive extremely ordinary cars. They often pick fundamentally sound cars that have good reputations but then they hold onto them. For them, impressing the neighbours is not a priority. They are more interested in increasing their wealth generating assets.

A Car is not an Asset

Money in the right savings account will be compounding for you, whereas money spent on a brand new car will evaporate day after day as your car depreciates. Let’s be clear, only the rarest of classic cars appreciate; most cars depreciate in value. Whilst you’re busy impressing the neighbours, your money is leaving you.

Similar to savings, property is also an asset that will appreciate over time. In most parts of the United Kingdom and many places around the world, property increases in value year upon year. If you are a homeowner, you can further increase the equity in your property by making additional payments against your mortgage. This means that you will pay off your mortgage in a shorter period and as a consequence will save thousands in interest on your home loan. You will be able to own your home outright many years earlier than originally agreed. Your mortgage provider would prefer that you do not do this because they will lose thousands of pounds. If you can afford them, making additional payments against your mortgage is one of the best financial decisions you can make in your life.

Trade Down Your Car

In many cases, a car is necessary; to get to work, or pick up the children from school, plus all the shopping trips and errands that you use it for. I’m not advising you to make do without a car; simply downgrade the latest model or forego the latest model to focus on your financial goals. In doing so you will be trading down your car to bring you closer to financial freedom. If possible, buy a much older car and pay cash for it. The money you save on car payments can go towards additional payments against your mortgage. You would be surprised how much difference an extra £200 or £300 per month will make.

I realise that for many people this kind of approach will require a mindset shift; choose this approach because it suits your financial goals and stop trying to keep up with the Joneses. You never know, the Joneses may be up to their necks in unsecured debt. By being disciplined, you will soon be far ahead of them anyway.

Making extra payments against your mortgage will increase your net worth. You should be tracking your net worth on a regular basis, this post explains the why and how, Why You Should Track Your Net Worth.

Have you considered buying an old car? Have you made additional payments against your mortgage? Let me know in the comments section below.

If you have enjoyed this post you will also like the following posts:

Save Hundreds on Rent Per Month By Becoming a Property Guardian

4 Obstacles you Will Face on Your Financial Journey

Best regards,

Mike

4 Obstacles you Will Face on Your Financial Journey

Save Hundreds on Rent Per Month By Becoming a Property Guardian

This post may contain affiliate links please read our disclosure for more info.

Image credit: https://www.propertyguardians.com/

Please make sure you are sitting down as you start to read this post. It is possible to save hundreds of pounds per month on rent in central London and some other cities across the UK. You can live in prime locations for just a few hundred pounds a month as a Property Guardian. Across the UK and dare I say it, the world, accommodation is the largest monthly expense for adults. This is an opportunity for those who are flexible to significantly reduce their monthly accommodation expenditure.

What is a Property Guardian?

There are property owners in London and other cities, who have to leave their properties empty for a period of time. Perhaps, they have to work abroad for work or have taken a sabbatical to travel the world. There are also commercial property owners. Whatever the reason this group of people would now need to employ a security firm to oversee the property in their absence and ensure that it is well maintained and free from vandalism and squatters. This is where Property Guardians fit in. Property Guardians are essentially live in caretakers who look after the property in return for a heavily reduced monthly rent.

How Does it Work?

People who are interested in becoming Property Guardian should contact one of the entrepreneurial companies that have been set up in this space. There are over 30 now, some are national whereas others are have a London focus, click here to visit the website of Global Guardians, or here to visit dotdotdotproperty.com . The second company is a Social Enterprise and takes a different approach to the for profit companies.

It Seems Too Good to be True

Well, funny that you should think that, there is a potential downside too. What you are looking for is a clean, convenient space with basic amenities that enables you to look after a property in return for a heavily reduced rent. There are two clear benefits for the property owner, first of all they get a live in caretaker. Secondly, when commercial properties are converted into residential dwellings they can save thousands in business rates reductions.

Unfortunately not all property Guardians have not had positive experiences, there have been instances where some Property Guardian companies have increased rents for Guardians and failed to maintain basic amenities including showers and kitchens.

My recommendation is that you do your own research; if you are flexible and can find a reputable company and good location – go for it! It could be a great way to live more frugally and help you to save money for travelling or some other major expense. I would not recommend Property Guardianship for families.

Have you ever been a Property Guardian? What was it like? Let me know in the comments section below.

If you have enjoyed this post you will also like the following posts:

Have you saved Enough into Your Pension?

How to get Value for Money When Buying Foreign Currency

Save up to £500 Per Year With a Sim Only Mobile Phone Deal

Best regards,

Mike

4 Obstacles You will Face on Your Financial Journey

This post may contain affiliate links please read our disclosure for more info.

Image credit: https://renaissanceguy.co.za/

The path to financial freedom is a route that is potentially open to many and yet few actually take it and liberate themselves. Achieving your financial goals and becoming financially free requires discipline and commitment, you will face many obstacles but with the right mindset and financial habits success will come. I have listed four of of the obstacles that you will face below. Consistency of action and your ability to adapt to changing circumstances will be key if you are to make it.

Obstacles on Your Financial Journey

Level of Income Changes

The days when employees could expect to work continuously for one employer for a period of forty years and then retire are long gone. In many cases, you are now more likely to be made redundant and suffer a period of unemployment during your career. The chances of this happening are higher if you are an ethnic minority or a woman. Self employed workers and freelancers are also more likely to experience fluctuations in their income levels. If this happens, you will experience a change in the level of your income which could jeopardise your financial objectives.

What to do:

You should immediately re-visit your monthly budget and assess the impact to your net worth. It is important that you adapt to your changing circumstances; should you look for a part time job while also looking for a new main job? Can you make cuts to your levels of expenditure? Surely, the entertainment budget can be reduced? These are questions that you will need to ask yourself. Hopefully you have an emergency fund that you can use until you secure another job.

Pressure from Creditors

If you are following the steps I outlined in this post, What’s the Best Strategy For Clearing Debts?, you will have a prioritised list of debts to clear. It should come as no surprise to you that your creditors will have no regard for your list. You may receive phone calls, text messages or letters from creditors who are a low priority on your list. They will want you to make payments to them and will not care what your overall plan is for reducing your debts. These communications from debtors are an obstacle to overcome and can put you under pressure. If you need to talk to someone consider contacting The National Debtline.

What to do:

Stay strong mentally and do not change your priorities in terms of debt reduction because you received a specific phone call. Stick to your plan that will result in you getting out of debt more quickly.

Pressure from Friends

True friends and family members will understand the financial journey that you are on and the steps that you are taking to put yourself in a better place financially. However, there will be many who do not understand or perhaps are not in your inner circle, they may continue to expect you to attend expensive social get togethers or go on holidays with them. This will put you under some social pressure.

What to do:

Do not give in to pressure to keep up with the Joneses at all. If an event or purchase does not fit with your financial plan avoid it. If you must attend a wedding or special occasion, plan and budget specifically for the occasion. Recycle an outfit for the occasion rather than buying a brand new one. If necessary, explain your decisions to your friends.

Changes in the Value of Investments

On your financial journey, you will experience many changes in the value of your investments. Depending on the nature of your investment portfolio, these changes could be quite significant. For example, those who have invested in cryptocurrencies during the last few years will have experienced a level of price volatility that can make even the most confident investor think twice.

What to do:

Keep tabs on your investments and prepare to takes steps to rebalance your portfolio if it is no longer consistent with the level of risk you are comfortable with. Avoid knee jerk reactions to market changes and consider the long term at all times.

Having a financial plan and goals is a wonderful position to be in, having the strength of character and determination to stick to it and adapt when necessary is even better. You will face obstacles but it is possible to overcome them. I write from experience, I have faced each of the obstacles I have described and more. I want you to come out the other side and be able to recognise your achievement and smile.

Have you faced any of the obstacles I have mentioned here? How have you handled them? Let me know in the comments section below.

If you have enjoyed this post you will also like the following posts:

Have you saved Enough into Your Pension?

How to get Value for Money When Buying Foreign Currency

Save up to £500 Per Year With a Sim Only Mobile Phone Deal

Best regards,

Mike

Do you Have the Right Money Mindset?

This post may contain affiliate links please read our disclosure for more info.

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If you are going to be successful achieving your financial goals it is essential that you have the right money mindset. You may be thinking, what does that even mean? In broad terms, A money mindset is your attitude to money, how do you feel about money? What are your emotional reactions to the subject of money? We are all a product of our environments, if you grew up in a mansion with servants waiting on your every whim, you are likely to have a different money mindset to someone who grew up without wealth or many material items.

Your money mindset is given its ‘default setting’ by your parents. If they struggled with money and always mentioned it in the context of having bills to pay or needing more of it, you are likely to have developed a scarcity mindset around money. You may feel that you never seem to have enough money or that saving for the future is not possible with your current circumstances.

Money Mindset

It’s important that you take time to assess your own beliefs around money. Make a list of any beliefs that you have around money and assess them. The opposite to a scarcity mindset is an abundance mindset. It was Stephen Covey who created the term ‘abundance mindset’ in his book, 7 Habits of Highly Effective People People . People with an abundance mindset believe that there are enough resources (including money) for them and others to share.

Fortunately, money mindsets can be changed, you can transform from a scarcity mindset to an abundance mindset if you work on changing your beliefs around money. This is important because a person with an abundance mindset will be more likely to stick to their financial plans and achieve their goals. Also, they will be less likely to self sabotage.

My objective with this post, is to move you closer to an abundance mindset if you don’t have one already. Following the steps below will help you get there.

Gratitude

Create the habit of expressing gratitude for all that you have, do this on a regular basis. You have a roof over your head and the ability to buy all the food that you need. No doubt you have the love of family and friends and the opportunity to live in a relatively peaceful environment. In many parts of the world, people would love this to be true for them too.

Positive Affirmations

Make a list of positive affirmations that you can recite on a regular basis. The impact of these will be to focus your mind on positivity. You will be able to overcome the obstacles that the day or week may throw at you. For most problems that you face, a positive mental attitude is part of the solution. You must believe in yourself and then act in a way that is consistent with your belief.

Evaluate Wants and Needs

It should be relatively straightforward to evaluate your financial needs and wants. This post will help you, How to Create a Budget That You can Stick To. An abundance mindset does not mean that money will magically appear but that there will be enough for your needs and the needs of others too.

Think Practically About Money Making Opportunities

An abundance mindset should be rooted in the practical, don’t make the mistake of thinking that it is all touchy-feely. Think about practical ways in which you can make more money; perhaps you could sell unwanted items, this post will help you think of ideas, 10 Ways to Make Money Now. If you own a business, you could make more money by finding new ways to attract customers. Hopefully you are now becoming aware of the many opportunities that are open to you.

Personally, I am using this blog to keep me executing best practice with regards to personal finance. We should all become more intentional about our financial decisions and creating an abundance mindset will definitely help us on our journey towards financial freedom. I hope that you will take the journey with me.

One belief that I have had to unlearn was the belief that money has to be earned as a trade off for time. I now know that it if you create massive value for a large number of people you can be rewarded far in excess of anything you could earn as an hourly rate or salary. Good examples of that are authors, musicians or online course instructors. They create abundance for themselves but only complete the work once and then continue to be paid for it. Before they created anything, they had to believe it was possible and to adopt an abundance mindset.

Have you had to consciously change your money mindset because of limiting beliefs? How do you feel about money now? What changes have you experienced? Let me know in the comments section below.

If you have enjoyed this post you will also like the following posts:

Have you saved Enough into Your Pension?

How to get Value for Money When Buying Foreign Currency

Save up to £500 Per Year With a Sim Only Mobile Phone Deal

Best regards,

Mike

Have you Saved Enough into Your Pension?

This post may contain affiliate links please read our disclosure for more info.

Image credit: https://www.finance-monthly.com/

Have you saved enough into your pension? For a large proportion of the United Kingdom population the answer is no. Most people are not saving enough for their retirement. Does your vision of retirement include freedom to travel and time to enjoy a comfortable standard of living? If we all to have the retirement that we aspire to one day, we will need to make sure that we are on track to achieve it. It is time to get serious and work out how much that will cost.

Pensions: Why Many People Are Failing

There are a lot of assumptions built into pension calculations, assumptions that are not true for many people. For example, the assumption that you will work 40 years of continuous employment with your salary continually increasing by X% and you maintaining your pension contributions at 12% of your salary for 40 years. Some of the realities of life such as redundancies, women taking time out to raise a family, individuals starting businesses, part time work, time out for studying and credit credit or student loan debts don’t exist in this Continuous Pension Saving Utopia.

I think when people realise that they are not on track to hit their pension goal, they give up and hope someone other than themselves will solve the problem. Let me be more specific, if you would like to live on a retired income of £25,000 you will need to have a pension pot of £500,000. That is assuming that you use your pension pot to purchase an annuity giving you the annual income of £25,000. Try this pension calculator to work out how much you would need at other income levels. As you can appreciate, £500,000 is a large amount especially when it’s considered that the average pension pot in the UK is around £50,000.

What Should you do Now?

Pension Pot

Work out the total pension pot you currently have, if you have had several jobs during your career you may need to do a little detective work to track down all of your workplace pensions. This article will help you find your pensions.

Up Your Contributions

Re-evaluate your household budget, can you afford to increase your contributions? If you are in a workplace pension then you should maximise the contributions that you make because these will be matched by your employer. If you are self employed, you should also increase your contributions.

Develop a Plan B

It may be that increasing your pension contributions alone will not be enough for you create a big enough pension pot for retirement. If that is the case, you should develop a Plan B.

Property is a great way to supplement your pension savings, you could downsize your main residence and use the profit for your retirement. Alternatively, you could rent out a spare room and earn extra income that way. There are other ways too, they include equity release and property investing. You can read more about these ways via this link.

If you own a business, this could become your Plan B. Depending on the nature of your business, you may be able to sell it and contribute money to your pension savings after the sale.

Don’t Lose Heart

The fact that you are reading an article like this is a positive in itself. You still have time to improve your level of preparedness for retirement and there are a number of ways you can do so.

Are you on track with your pension savings? If not, what are you going to do about it? Let me know in the comments section below.

If you have enjoyed this post you will also like the following posts:

How to get Value for Money When Buying Foreign Currency

Save up to £500 Per Year With a Sim Only Mobile Phone Deal

Best regards,

Mike

Are you and Your Partner Financially Compatible?

This post may contain affiliate links please read our disclosure for more info.

Image credit: http://thepayoffprinciple.com

If you are going to be successful and achieve your financial goals you will need to face up to obstacles head on rather than wait and hope that they disappear of their own accord; usually, they do not disappear of their own accord. Are you financially compatible with your partner?

First of all, a quick definition, when I use the use the term financially compatible, I mean to share the same financial goals, vision and habits. Are you both saving regularly and maximising investment returns? Is your discretionary expenditure linked to value for money? I do not mean that you need to be earning the same salary. It is great if you are but it is not essential for financial compatibility. The key word in this context is together, ideally you need to be able to plan your financial future together and work towards it. This could mean saving to buy a home, a goal of becoming debt free or financial freedom (retirement) at an early age.

Financial literacy is not a skill-set everyone has, some are willing to learn whereas others are more interested in living for the moment instead of having a financial plan. Not everyone approaches personal finance and their financial responsibilities in the same way.

Are You Financially Compatible?

Disagreements over money remains one of most common causes of divorce. If one person is a disciplined, lifelong saver and the other is frivolous with money, there will be friction between the two. In my opinion, if these differences are entrenched there is no chance of achieving your financial goals together. It does not seem very romantic to consider a partner’s financial compatibility when you are just getting to know them but if you don’t, you could be storing up problems for yourself later on. Hopefully, if you are in a relationship you have already taken an opportunity to discuss money with your partner.

Depending on your starting point, following a budget for a prolonged period can be hard work. To achieve financial freedom for example, you and your partner will need to work as a team and to be consistent. You need to be in alignment.

Create a Financial Plan Together

If there are only slight differences between you then thankfully, with a calm approach, compromises can be agreed upon.

If that is the case, the following steps will help:

Arrange to have regular money meetings with your partner; during these meetings discuss financial goals and budgeting and agree a way forward.
If one of you is the natural saver, take the lead in these meetings but be careful to avoid being judgemental.
Build in quick wins on your financial journey together, this could be paying off a credit card with a low balance or saving for a planned weekend away.
Allow yourself small celebrations when you hit your financial milestones, be creative with these and do not spend a lot of money on them.

By working together you will dramatically improve your financial health and you will strengthen your relationship. Well done! Your future is looking bright.

Have you sat down with your partner and discussed finances? How did the conversation go? Let me know in the comments section below.

If you have enjoyed this post you will also like the following posts:

How to get Value for Money When Buying Foreign Currency

Save up to £500 Per Year With a Sim Only Mobile Phone Deal