Are You Frozen in an Unhealthy Financial Cycle?

Managing money is a year-round challenge, but winter months can be particularly hard on family finances. For starters, cold weather cranks-up your energy spending, squeezing your budget to keep up with the cost of heating your house. Your financial obligations during the first part of the year may also include credit bills from Christmas spending and seasonal travel.

The self-employed may feel the pinch following the brisk fourth-quarter spending season, as businesses and individuals tighten their belts for a winter recovery period. Retailers and others relying on steady sales know the cycle well, typically experiencing a first-quarter lull, year after year. As these financial obstacles mount, often compounding one another, cash-strapped families are eager to embrace saving opportunities this winter.

If your own flow is hampered by these or other financial strains, finding an affordable loan can help you stretch your resources between paydays – without a formal credit check. But if the shortfall lingers and you need a more permanent solution, a number of money saving hacks can help get you back on track.

How to Thaw Your Finances This Winter

When your finances falter, it can feel like the weight of the world is pressing down on your pocketbook. If it’s time to get out from under the strain of an unsustainable financial flow, a suite of money saving measures are at your disposal, helping ease the burden. Experts recently shared a few of their methods for saving money this winter.

Take it Month by Month – When overwhelming financial conditions arise, it can be hard to see the light at the end of the tunnel. Rather than buckling under the strain of the big picture, experts recommend breaking down the problem into manageable chunks. Not only is it easier to track your progress, but wining small victories along the way can also help keep you focused and headed in the right direction.

Without a personal budget, you’ll be hard-pressed to recognise savings – even when you’re successful. Establishing monthly spending limits ensures you’ll make the most of savings opportunities, repeating the gains month after month, until you achieve financial balance. The particulars vary from person to person, but the foundation for any solid budget is an accurate accounting of your total earnings and outgoings. Once you’ve established a baseline from which to operate, it’s relatively easy to begin carving-out targeted savings.

Cut Back Whenever Possible – Noting your spending during a single month can yield surprising results. Many people who find themselves in financial difficulty don’t have a sense of where their money goes, so putting spending under a spotlight sometimes yields obvious clues you can use to cut back.

Maybe you didn’t realise how much you spend on lunch during a given month. Examining your monthly spending total for midday meals may be all the incentive you need to save money every day. Pack a lunch and watch the saving grow; it’s as simple as that. Apply the same philosophy to your morning coffee or tea, brewing at home, rather than overspending at a cafĂ©. And when your budget shows entertainment spending you can’t afford, cut back on pub visits or limit yourself to fewer pints.

For immediate savings, compare prices, if you don’t already, consistently settling on the best available values. Committing to this disciplined approach can save you hundreds of pounds at the market alone. And spreading the frugal philosophy to other things you buy ramps-up savings even further.

Manage Your Accounts – When it comes to banking your earnings, there is more than one place to put your money. The choices you make have an impact on how fast your money grows. Getting the best rate of return on your saving account is a good start, but your current account can be another money-maker, if you select the proper type of account.

If you haven’t shopped your banking services recently, take a look at your spending and saving habits, in order to match them to the best alternatives, for your circumstances. You may be surprised to learn that current accounts outperform other places savers keep their cash. You may have to meet certain balance and deposit requirements to land the best rates of return, but it’s worth it, when you’re able to put your money to work, growing at a faster rate.

Keeping up with your spending obligations requires year-round attention. Rising to the challenge can be particularly difficult in the wintertime, when energy bills and holiday spending catch up with your cash flow. If your finances have gone cold, use these proven strategies to thaw them out this winter.

Paul graduated in 2001 with a degree in Finance. Since then he has gone on to work for several of the UK's most well-known financial institutions.

An avid blogger and a huge football fan, Paul is here to guide you through the ins and outs of personal finance and perhaps save you some money in the process!

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