The New Year is often seen as a time for resolutions and fresh starts, and what could be more important than financial health? With the holiday shopping season wreaking havoc on budgets, now is the perfect time to regroup and set your financial priorities for 2025. Two guides offer month-by-month advice, helping readers streamline their financial management and develop healthy habits.
Starting with January, one of the most pressing tasks is to tackle your self-assessment tax return. Over 12 million people are expected to file their returns, with the deadline creeping up fast on January 31st. Don’t fret if your financial affairs aren’t complex; according to HM Revenue and Customs, the online filing process is straightforward and user-friendly, taking as little as 20-30 minutes. Should you find yourself unable to pay your tax dues outright, you can set up installment plans if you owe less than £30,000, easing the immediate burden.
Then, as February rolls around, it’s time to give your pension some love. Reviewing your retirement strategy at least once a year is key to achieving your future goals. If you’re enrolled in a defined contribution pension scheme, you should have received your annual statement—if not, reach out to your provider. Consider increasing your contributions if your financial situation permits. Some employers will even match your additional contributions, amplifying your savings potential.
March brings another important milestone as the end of the tax year approaches. This is the month to maximize your Individual Savings Account (ISA) allowance, which stands at £20,000. The benefits of ISAs are clear: they shield your savings from taxation, enhancing your net earnings. It’s wise to explore various accounts to find the best interest rates. Financial analyst Myron Jobson notes the significance of this strategy, especially for higher-rate taxpayers, who could face considerable taxation on interest earned outside of ISOs.
April marks the time to shop around for the best utilities deals. With energy prices commonly hitting caps on April 1st, now is the moment to reassess your gas and electric tariffs. Experts suggest switching to fixed-rate deals can yield substantial savings, sometimes exceeding £139 annually. And don’t forget about revisiting your broadband and mobile contracts, as price increases typically occur during this time as well.
May is often the month people think about their travel plans. If you have summer trips scheduled, it’s time to double-check your passports and financial options for spending abroad. Some banks charge hefty fees on foreign transactions, so exploring fee-free credit cards or bank accounts can save you money during your travels.
By June, it’s time to check for any lost financial assets. Many individuals lose track of old investment accounts or bank holdings. Services like My Lost Account can help trace misplaced accounts, allowing individuals to reclaim their lost savings easily. This is also the month to keep your child trust funds or junior ISAS organized to secure their financial future.
July should be dedicated to sorting through your paperwork. Organizing your financial documents not only helps you maintain clarity but can also be beneficial when preparing for taxes. Experts recommend keeping important documents safely stored, both physically and digitally, to prevent loss.
August signals wedding season, prompting couples to discuss their financial future together. Open conversations about budgeting, debt management, and shared expenses can set the stage for smoother financial sailing as newlyweds. Co-habiting couples, particularly, should be diligent with their wills to avoid complications should death occur without legal documentation.
September opens the door to saving for children’s educational expenses. Savings accounts for children provide unique benefits, and parents are encouraged to use junior ISAS to maximize savings. This is the perfect time to establish accounts to teach children the value of saving money.
October, known for Free Wills Month, presents opportunities to write or update your will at no cost. Many don’t realize the simplicity of drafting a will—you don’t need to enumerate every asset, just designate percentage distributions. Frequent reviews of your will are necessary, especially after significant life events like marriages or births.
November sees Black Friday descending upon consumers, traditionally heralding a wave of pre-holiday spending. A strategic assessment of credit cards can help you maximize rewards during this busy shopping period. Balance transfers to cards with lower rates or interest-free options may prove beneficial if you’re carrying debt.
Finally, December offers the chance for charitable giving. Optimizing donations through gift aid can increase charities' receipts significantly. Keeping track of these donations aids when it’s time to prepare for tax returns the following January.
By keeping these strategies in mind throughout the New Year, individuals can create rituals for financial self-care. Each month provides new opportunities to sharpen financial practices, enabling everyone to usher in 2025 with confidence.
