As we near the start of a new year, take the opportunity to get on top of your household finances now so you can start 2026 with peace of mind. This guide outlines the simple steps that can make a big difference with organising money.

1. Understanding your financial position

You can’t get on top of things unless you understand your existing position, so start the process with a thorough evaluation of your finances. 

Create a budget with your income balanced against your outgoings, separating essential and non-essential expenses and your various savings channels. First and foremost, ensure you’re in the red and not the black, then look for any areas that aren’t aligning with your financial goals. You can create a budget in Excel using manual formulas or investigate apps which are set up to manage personal finances.

2. Managing essential expenses

Once you have an overview of your essential expenses, organise these to make it easier to stay on top things, avoiding missed payments and subsequent late fees. For example, arrange for all your monthly bills to go out on the first day of the month, so you have a clearer idea of exactly how much you have to spend until you receive your next salary. 

While organising, look for ways to minimise your monthly expenditure too. Check for duplicate payments and identify opportunities to combine separate accounts such as switching to multi-car insurance cover which could reduce your overall costs. Remember that energy and phone providers sometimes offer the best rates to new customers, so it’s worth shopping around regularly.

3. Improving your credit score nvesting in the home

From giving you access to better mortgage rates to helping you split major expenses over several manageable payments, there are many benefits to having a good credit score. It’s also relatively quick and easy to improve, with registering to vote being something you can do immediately to boost your score.

Eradicating bad debt and keeping up with essential payments are key to having a good score, so prioritise these factors over non-essential spending. Credit cards can be useful tools to show responsible credit management, but try to use no more than 25% of your available credit limits and pay more than the minimum charges each month.

4. Building short- and long-term savings

It can be hard to balance spending and saving. Having clear goals and following strategies like the 50/30/20 method is a great place to start, but connecting these to suitable savings channels is key to saving effectively. 

Your short-term savings should be considered a ‘fund’ for large essential payments throughout the year, such as car servicing and holidays, and emergencies. It must be accessible, so choose a savings account with the best interest rate that doesn’t block or penalise withdrawals. 

Long-term savings, such as future family finances and retirement pots, are best locked away in fixed-term savers with better interest rates. You could also look at the option of low-risk investment to try to get ahead of inflation and protect the value of your money.