When you’re in the throes of your best years, looking after your pennies isn’t always a priority. Trust us, we’ve all been there.  Life is busy, exciting and littered with social plans, nights out and hiking rent prices. However, if you can put just a little bit of effort into financial planning you could save yourself a lot of heartache (and money) in the long run. Here are our top tips for remaining financially savvy that you don’t need a finance degree to follow! 

Make a budget
However much money you are making, planning a small monthly budget is the key to feeling secure within your finances and living within your means. Whilst we would recommend pulling out a spreadsheet for this task, it can also be done on your notes app or even written down! There is no one way to budget. Just remember, start with high-value costs such as rent, insurance and bills and make sure to leave room for those much-needed ‘fun tokens’. Knowing exactly how much you have to play with before it comes in is a great way to keep on top of your income and avoid any surprises. ‍

Have a separate bank account that you move or pay in essentials such as bills or rent
As well as budgeting, it’s good to separate the big money from the small. Shift money for non-negotiables like rent into an account that you don’t touch unless it’s sending the money onwards. That way you minimise the risk of spending essential parts of your budget that could have damaging repercussions if not paid on time. Banks such as Revolut and Monzo have ‘vault’ features, where you can even lock away your cash! It's also worth thinking about getting an account which has 'round up features' to make the most of your secret spare change. You could be saving pennies without even realising.

If you’re freelance, set aside money to pay tax! 
If you find yourself working freelance, it’s really important to make sure you account for future income tax in your budget. Freelance incomes normally vary from month to month so it’s important to put away an average of 20% of your monthly income to make sure you’re covered when the time rolls around to do your taxes. Another cheeky tip for owning your freelance income taxes is to remember to keep hold of those invoices! If you’re doing your taxes in 2021, your data and income will be based on what you earned in 2020 so it’s good to keep a record of all your incomings, outgoings and expenses. Who knows, you might be lucky enough to get a rebate! 

Every little helps -start saving small!
Even if you put aside a fiver a month, start saving in small quantities. In this harsh world, the only way to get ahead of the game, especially if you’re not making lots of cash at first, is to save little and often. Most of us don’t have massive incomes or other resources to back us up, so it’s up to us, our drive and dedication to start practising healthy saving techniques. 

Invest your money
To understand the world of money and personal finance you’ve got to learn that it’s a world that is based around investment, and investment is not just confined to big bankers and Canary Wharf dwellers, everyone can invest - regardless of income! If you have the means to, investing in projects that you care about and see thriving can be a great way to make some extra cash in the background. You won’t see it building, but the right investment can have great repercussions for your bank account. There’s lots more info on savvy small investments out there, so do your research and consider putting your money where your mouth is! Apps such as Plum are doing the most to help young people positively invest, and understand the investment world without any of the confusing jargon.  

Look after your credit score
Credit is a financial attribute that is invisible, but essential to your life. Whether you want to take out an Amex, or even a mortgage, it’s important to keep your credit score in check, especially whilst you’re still young.  If possible, avoid racking up debts, even if they are small, on credit cards and prove that you have a positive credit history. For example, if you do have a credit card, paying it back on time. Something as simple as registering to vote at your address can have a positive impact on your score. Experian, the UK’s most trusted credit advice service, has multiple tips and tricks on how to incubate your credit score. You can check these out here. 

Don’t be afraid to ask for help!
If you’re unsure about how to plan your finances, check your credit score, or do your taxes, ask for help! Your parents, peers and even boss will have been in your position so there is absolutely no shame in asking for help and it might save you a lot of trouble in the long run. 

Look at your skill set - are there ways you could make extra money?
There are loads of ways to earn freelance salaries on the side of learning, internships or work that could boost your income. Although we understand that having multiple side hustles alongside a full-time job shouldn’t be necessary, if you work part-time, or have some free time it can be a really great way to broaden your skillset and line your pockets. There are hundreds of freelance jobs boards on Facebook as well other social media sites such as Linkedin, so keep an eye out for career-building opportunities. 

Words: Grace Goslin

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