It will then show you exactly where all your money is going – you can view all your accounts in one place. You can connect all your financial accounts, for instance all of your credit card accounts and multiple current accounts (if you have them). You can also use a budget app to help with everyday spending and improve your personal finances and financial situation in general.Īpps like Snoop¹, a free budgeting app, have a spending analysis tool and some handy budgeting features. Instead of just rounding up your spare change, or saving and investing your money automatically. Use free budgeting apps to improve spending habits Nuts About Money tip: review and cancel wasteful subscriptions! They’re a real budget killer. It gets easier over time! And the most popular budget apps (above) are helping lots of people across the UK – you’re not alone! There’s lots of options out there, but ultimately it’s about changing your behaviour over time, think of it like trying to change a habit. And never touch your bank cards or bank accounts for the whole month. You could also take out cash each month after you’ve set a budget limit, and you can only spend the cash you have, think of it as ‘spending money’ like on a holiday. Or, you could start introducing ‘no spend’ days, where certain days per week you absolutely cannot spend any money at all (except for essentials like travelling to work). It’s a hard problem to solve on your own without a budgeting tool (either an app or simply managing your money yourself) – but is certainly doable.Ĭommon tactics are going completely ‘cold turkey’ and not buying anything that you don’t need for a certain period of time (for instance a month). Some of us have some fairly bad spending habits! But that’s okay, as least you know you have a problem (or do once you’ve set up a budget). This is called the ‘Additional rate’.įairly straightforward right? Here’s a table to make it a bit easier: And above £150,000, you’ll pay a staggering 45%. Then, if you're lucky enough to earn above £50,270, you’ll pay 40% tax on everything up to £150,000. Whoop!Īfter that, any money you earn above that, you’ll pay 20% Income Tax on. That’s how much you can earn every tax year (April 6th to April 5th the following year), without having to pay any tax at all. You first get a Personal Allowance, and this is currently £12,570. If you’re not quite familiar, here’s how it works. Income Tax comes straight out of your pay packet if you’re employed, so you might not even know you pay this! If you’re self-employed, you’re probably a bit more familiar – as you’ll have to handle it yourself every year (you’ll handle this through your Self Assessment tax return). Budget with your after tax pay (the income tax has already been paid). Income Tax is one of your biggest bills even though you might not even realise it. Income Tax is a tax on quite simply, your income! Everyone has to pay it, and it goes towards public finances which the government then decides where it’s spent. They can help to save and often a lot more, without you even realising, or having to do anything! You’d soon build up a huge savings pot!Īnd this is where budgeting apps become super useful. And if you can do even better than this, great! Such as 30% for needs, 20% for wants and 50% for savings. Just save as much as you can to begin with. If you can’t quite save 20%, don’t worry. So, 50/30/20 – pretty simple right? 50% for needs, 30% for wants and 20% for savings. If you’ve got things like credit card debt, it’s better to pay this off first, rather than build up a savings pot, as the interest rate is often very high – and you won't get the same interest rate from your savings, so you will technically keep losing money.īy the way, interest is either what you pay to borrow money, or what’s paid to you for lending your money (which is what happens when you put it in a savings account – you are effectively lending it to a bank or financial institution). 30% is your budget that you can’t go over (ideally), and the lower the better!Īnd the remaining 20% is for savings – or if you’ve got any debts, use this money to pay off debts. Anything you like really! But remember, it’s not a target to spend 30%. This is things like buying new clothes, going out for drinks, or even a date and your subscriptions like Netflix etc. With this, you want to aim for 50% of your spending on essentials, such as rent or a mortgage, and all of your household bills and living expenses (your needs). Then, we’re going to use the 50/30/20 rule. If you’re not sure about Income Tax and National Insurance contributions, we run through this below.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |