6 ways to spring clean your finances

6 ways to spring clean your finances

1. Take control

"Know where cash goes by listing your monthly income and expenditure," says Edward Ware from StepChange Debt Charity. "Then jot down everything you buy over a week and ditch unnecessary purchases."
Get into the habit of shopping around and getting the best price for everything, and pay by cash so you spend less!
Tip: Use MoneySmart and Savings Goals apps to track spending on the go. 

2. Ditch debt

Brits typically owe £3,249. Matt Sanders at Gocompare.com says: "Debt used carefully can be a helpful part of financial planning, spreading the cost of major purchases. But overspending on credit cards is how people get into trouble, so shift outstanding balances to a 0% credit card to reduce the interest rate until the debt is paid off. 
Worth it: For lowest overdraft rates look at First Direct (0800 24 24 24) or Metro Bank (0345 0808500).

3. Start saving

According to Bright Grey the most unexpected bills are house repairs (£820) and replacing an appliance (£509). Rachel Springall at MoneyFacts says: "Have at least one month's income in an easy-access account to cover these emergencies. Then deposit up to £15,000 in a Cash ISA (new limit from 1 July 2014) so you pay less tax on savings. Split the remainder across a short-term fixed and an easy access account. The good news is savings rates could rise this year."
Tip: People with savings goals save £42 more monthly, says NS&I.

4. Minimise mortgage

Being mortgage free sets most homeowners' hearts racing. Overpaying will help you get nearer that goal. "Lenders typically allow overpayments of 10% a year without charges and means you pay off your mortgage earlier and incur less interest," says Ray Boulger at Charcol.co.uk.
Worth it Take advantage of low rates before they disappear! Five-year fixed mortgages are available below 3% for those with a decent amount of equity.

 5. Plan retirement

If you're working, sign up to the company pension scheme. "Your boss has to put money into that as well as you so it's effectively free money!" says Jasmine Birtles at MoneyMagpie.com. Then check your National Insurance payments. "You need 30 years of contributions to get the full State Pension and if you're not sure use the State Pension Calculator on Gov.uk to find out. If you've taken time out to be a mum you'll automatically get National Insurance credits while you receive Child Benefit for a child under 12," says Jasmine.
Worth it: Use ISAs to save for retirement, too.

6. Tax tactics

"Ensure you’re on the right tax code and not paying more to HMRC than you should," says Andrew Hagger at MoneyComms. "There’s a calculator and tips on www.moneysavingexpert.com. For example, did you know that if you wash your own works uniform at home you could be entitled to tax relief of £60 per year?"
Check if you can get additional money through tax credits and benefits by going to www.entitledto.co.uk
Worth it Another tax saver is for your husband or civil partner to transfer his or her savings and/or investments to your name if you pay a lower rate of tax.