BAND experts share their top money-management tips

According to 2024’s Real Life Advice Report by Opinium, 92% of people who receive ongoing advice from a financial advisor say it improves their mental and economic well-being. We asked our team to share their top tips for maintaining top financial health.

1. Are you making the most of your allowances and reliefs?

It’s easy to lose track of how much money you can put into each financial product and whether you’re entitled to specific allowances and reliefs.

For your cash savings, including your emergency fund outside of an ISA, basic rate taxpayers can receive up to £1,000 in interest per year without paying tax on it. This reduces to £500 for higher-rate taxpayers and to £0 for additional-rate taxpayers.

In addition, it’s a good idea to shop around to see if you can boost the rate of interest you are receiving!

For ISAs, there’s a total allowance of £20,000 per person per year. This covers all types of ISAs – cash, stocks & shares, and Lifetime ISAs. Remember, too, that you can only open one type of each ISA per tax year.

For pensions, you have an allowance of £60,000 (or 100% of your earnings, whichever is lower). If you have spare cash, it is worth topping up your pension, primarily due to the tax relief. Remember, too, that you can carry forward unused allowances from the previous three tax years in certain circumstances.

2. Undertake a personal finances review

Things like pensions tend to rumble on in the background throughout your working life and it’s easy to lose track of what rates you are getting on your ISAs. Therefore, listing all your liquid assets can help you understand whether you’re on track to achieve your financial goals. For example, going back through your employment history and ensuring you know where each of your pensions are is a worthwhile exercise. This could lead you to consider whether it is sensible to bring those pensions together, perhaps with the help of a financial planner.

Is your emergency fund still adequate? You should have at least six months’ worth of expenditure in cash at any one time. However, your expenditure may have increased over time, or you might have eaten into your cash savings. Therefore, replenishing that cash fund, if required, can ensure you have that safety net.

3. Cut the unnecessary memberships!

It’s easy to forget to cancel that free trial of a new streaming service or magazine subscription, so taking your latest bank statement and checking for any regular direct debits can help to identify unnecessary expenditures. 

It also pays to consider whether a monthly direct debit is the best way to pay for a service. For example, if you’re only an infrequent gym user, does paying-as-you-go make sense rather than paying for a monthly membership?

Similarly, it’s an opportunity to shop around for things like mobile phone or broadband contracts. Other providers are keen to win your business; often, it doesn’t pay to be a loyal customer, so checking out whether there are cheaper options that better suit your needs could save you cash. If you manage to free up some cash, you can look at where to put that – perhaps into an ISA or pension.

4. Set up regular contributions to ISAs, savings or pensions

We all know that it’s all too easy to spend money we should be saving. A good way to avoid this is to set up regular, monthly contributions to a savings account, ISA or pension. 

Setting up a direct debit just after you get paid ensures that money gets saved, and you can manage your other expenses accordingly. It can also avoid a rush to utilise your allowances at the end of the tax year.

In addition, regular contributions to any form of savings or investments help smooth out the volatility of stock market blips or changing interest rates.

Don’t feel guilty if the monthly amount seems small – it’s keeping the regular saving habit going that’s important in the long run.

Why taking financial advice is a smart move.

Blitzing your finances once a year is a positive step, but it isn’t the best way to manage your money. Instead, the ongoing help of a financial advisor will keep you accountable and focused on your long-term goals. Good advisors will provide personalised advice based on your specific circumstances and objectives and suggest better ways to manage your money. Working with an adviser removes the burden of managing your money while keeping you on track. Don’t hesitate to contact the BAND team for more detailed insights and strategic guidance.