Long before we discovered the magic of Marie Kondo, decluttering our homes has been a way to refresh our spaces for the new season ahead.
Decluttering isn’t just about visual clearout: it can really impact other areas of our lives. Researchers have even found a link between clutter and procrastination.
While financial clutter might not cloud our visual field in the same way physical clutter does, having our finances in disarray can wreak havoc in other areas, creating a vicious cycle. We may feel stressed about our finances; in turn, that stress may be making it harder for us to improve them, according to mental health charity, Mind.
Applying a “spring cleaning” mentality to finances could be one way to clear the cobwebs and start to feel empowered about your financial situation moving forward.
Better yet, it can help you save money, too – from checking your direct debit outgoings to managing those auto-renewals. You don’t have to swear off all of the little luxuries, but a few small changes could reap big benefits.
Check those direct debits
As a nation, we’re spending billions a year on direct debits and subscriptions – and even those of us on top of our finances are guilty of signing up to a “free trial” and forgetting to cancel or hanging onto a service just because we might use it again one day.
The past year of uncertainty and dramatic lifestyle adaptations – working from home, job insecurity and pay cuts, spending more time indoors – has also meant that our spending needs have changed.
Many services we’d typically be paying for – and treating as essential – like our gym and leisure memberships, will likely be frozen until everything starts reopening. In the meantime, you may be able to redirect those funds elsewhere, like a savings account or ISA.
Another thing to remember: your direct debits are all coming out of your account at different times. Some are weekly, others monthly, while others sneak out every six months or annually. Tracking direct debit payments with calendar alerts and notifications on your banking app is another good idea so that you can be reminded of what’s going out – and when. This will help you track your use of a service, and whether it’s worth the price.
See how you can save on bills
Another easy financial trap to fall into is simply letting things be. From our energy bills to our broadband, we often can’t be bothered to make the switch or see what else is out there. Yet a quick search on the internet could reveal hundreds of pounds of savings to be had, across a range of home utilities.
Compare the Market’s handy Bills Calculator encourages customers to Meerkat Your Bills. Simply enter your postcode and some details about the type of home you live in and your heating and you’ll get an average cost of what people in your area are paying for the same services (broadband, energy and home contents insurance).
In addition to financial benefits, you could be seeing other perks from making a switch, like better service and greener energy, which is beneficial for you and the planet. And of course, being responsible about your energy usage – unplugging devices, turning down the thermostat by a couple of degrees – can also minimise your energy bills and save some cash, too.
Beware the automatic car insurance renewal
We know we really should shop around for the best car insurance deals, but then we forget and it’s too late – our policy has renewed automatically, and it’s not doing us any financial favours.
Before you procrastinate any longer, call your insurer and opt-out of auto-renewal to avoid being one of the estimated six million people in the UK overpaying on insurance, for both car and home, according to the FCA.
Don’t wait until the last possible moment to do this, either: research from Compare the Market found that drivers could be missing out on cash by waiting until the day their policy ends to switch their car insurance providers. Those switching three weeks before their policy renewal date could be finding policies that are as much as £319 cheaper.
If at all possible, try switching your car insurance earlier in the year: costs tend to be at their highest in December, before dropping again in January.
With Compare the Market, you can compare car insurance quotes from a range of insurance providers after answering some questions online – do this well ahead of your policy end date so you can maximise your savings if you decide to make a switch.
You could save money – and a lot of hassle – by bundling your internet, phone and TV services, or some combination of the three. Instead of having a host of different providers, one can do it all for you.
There are often added incentives to doing this – premium channels for free or at a discount, extra vouchers – not to mention that it’s an opportunity to improve your broadband setup and benefit from higher speeds (essential for at-home workers), get a new streaming service you’ve been coveting or cover international phone calls. Start comparing deals here.
Organise your accounts and budget for your future goals
Spring cleaning your finances could involve an element of physical organisation and clearing out, too, like filing paperwork away – especially essential if your office has moved to your kitchen table – or making an inventory of items you’ve expensed and need reimbursed.
If you’ve had the same accounts for a while, then you may be missing out on a better deal if you don’t do a spring clean of your bank, too. There are often cash incentives if you switch your current account, or you may be able to swap to a savings account that yields a higher interest.
Once you’ve taken stock of what you can cut and where you can save, it’s key to make a budget and review your financial goals for the months and year ahead, which may have changed dramatically since you last reviewed them.
There are different popular budgeting styles to choose from, so you can find the one that works best with your financial position and personality. Some people portion out their money into different categories with the (digital) envelope method and there’s also zero-sum budgeting, where every penny is distributed towards a specific financial purpose.
Find out more on different deals available across energy, broadband and contents insurance – and see if you could save – with Compare the Market’s online bills calculator.