Money for Life work in partnership with the Money Advice Service, an independent organisation set up by government. Money AdviceService provides free, unbiased money guidance across the UK to help people make the most of their money. If you have a question or need help, you can chat to them here.
Managing your money well can ensure that you’re having fun while still being sensible. Do you have this money management thing covered? Take our Money Management quiz to find out!
WRONG... The answer is Rent and bills
Before you start planning holidays make sure you have your essential outgoings paid first each month. That includes rent, household bills, phone bill, council tax…
However boring it may seem to focus on them first when it’s payday, they really ARE the most important things. Be organised. Have a notebook to keep track of your money, or spreadsheets. Everyone loves a colour-coded spreadsheet.
If you’re still not sure what you should be spending your money on each month, try the Money Advice Service’s budget calculator.
WRONG... The answer is True
It's important to avoid unmanageable debts. That means steering clear of credit cards or loans you don't really need, where you will be charged very high interest so your debt could easily spiral out of control.
Make sure you know where your money is going:
- Keep a note of all your incoming and spending.
- Keep some money tucked away, just in case.
- Be realistic about what you can afford
- Pay for everything outright if you can to avoid paying high interest loans
WRONG... The answer is Emergencies
Once your debts are paid off, start saving for an emergency or rainy day. You never know when you're going to need a cash cushion.
NextWRONG... The answer is False
You will be hard pressed to find a savings account paying high interest these days, better rates are offered on accounts where access to your money is restricted.
Boost your savings by taking out a Cash ISA. They work like a savings account, but your deposits won’t be taxed. You can look at Fixed-Rate Bonds too, where you can dump a large sum of money for a long period of time. You can’t make any more deposits or withdrawals but you get a chunkier interest rate for being tied for a fixed amount of time.
WRONG... The answer is False
This is only for people who have a stable financial foundation first! With riskier investments you might make more money, but you also run the risk of losing the lot. This includes unit trusts, investment trusts and shares in single companies. Don’t be greedy and get sucked in by offers of high returns. Always read around the subject and do your own research before committing to a purchase.
Well done!
Check out more articles about borrowing and debt here.
Money for Life work in partnership with the Money Advice Service, an independent organisation set up by government. Money AdviceService provides free, unbiased money guidance across the UK to help people make the most of their money. If you have a question or need help, you can chat to them here.
