How to Make The Most Of Your Money

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Money management is one area of adult life that a lot of people struggle with. It can be hard to figure out how to make the money that you earn work for you effectively. Should you be investing in stocks and shares or using a savings account or an ISA? If you have debt, is it more important to pay that debt off or to save? What order should you be paying debts off in?

All of these things matter and can make a huge difference to how well off you will be in the long term. It’s never too early to start planning your finances – even if you’ve only just gotten your first job. It’s also never too late, so if you’re in your 40s with no pension, don’t panic – start saving now, because it will make a difference. According to a study conducted in 2016, there are millions of adults with less than £100 in savings. If you’re one of those adults, then now is the time to start planning a turnaround for your finances.

make most of your money
Shutterstock Licensed Photo – By pathdoc

Save the Pennies, Build Them Into Pounds

It’s actually easier than you think to start saving. There is a growing number of apps that will either siphon off the pennies from your bank account to save them, or round-up purchases to help you save money without really noticing it. Some, such as Money Box will round up purchases and then put the money into investment products, letting you invest in big companies with small amounts of money.

Pro-active Investment

If you want to be more proactive and have a little more money that you want to put to work, then you can get advice from a robo-adviser to give you an idea of what portfolio to build. Of course, with any form of investment there is some risk, but these services can be ideal for building up a portfolio. You can provide information about your circumstances, your long-term goals and how much money you have to play with and get matched with a suitable potential investment.

Snowball Your Debts

If you have debts, then you should think carefully about how much to spend and how much to save. It is always a good idea to have SOME savings, and indeed even some that you can access relatively quickly, because having access to some money for emergencies will help to cushion you when things go wrong. If you’re living paycheque to paycheque and need to take out a payday loan because your washing machine has broken down, then you are just digging yourself deeper into trouble.

Once you have a small buffer built up, though, it’s a good idea to start paying off your debts. Why save money at 5% when you’re paying 17% on debts? Your money will be working harder for you if you use it to pay off those debts. Try to transfer debts to zero percent credit cards, and pay off the highest interest rates first, then start saving and investing that extra cash once you’re debt free.