Wrap Up the Year With a Personal Finance Review



Time seems to move faster as each year comes to a close. One minute you’re preparing for fall weather, and the next thing you know you’re staring down New Year’s Eve. The holiday hustle and bustle is likely to blame; Britons are typically on the move during the season, spending less time on day-to-day matters. As quickly as it passes, the end of the year represents an opportunity to reset.

The symbolic refresh offered by a new year is a significant milestone for individuals and business, looking forward to better days ahead. With New Year’s resolutions and other positive commitments in mind, many Britons turn over the year’s final calendar page with an optimistic, hopeful attitude for the future.

As you prepare to leave another year in the rear view, your personal finances are an important concern. And since your annual spending comes to close at the end of December, the year’s end is a great time to assess your finances. Are you satisfied with your earnings for the year? Did you meet savings goals? How’s your year-end debt level, compared to what was owed at the beginning of the year? Measuring these and other financial concerns can help you wrap-up 2018 with financial momentum, and plan for a prosperous new year.

Spending Breakdown

Even before you crack the books on your financial review, you already know you made at least some spending mistakes during the year. Part of the reason you’re looking is to avoid making the same ones again, so your financial assessment should include honest accounting for all your annual spending.

Does a particular negative spending pattern stand-out right away? Is discretionary spending throwing your finances off balance? Did you spend more than you earned during the calendar year? Answering these and other questions, based on accurate year-end accounting, puts you on a course to make better spending decisions in 2019. The Money Health Check is a helpful tool for assessing your finances and rating your effectiveness managing money.

Costly Credit

Your personal outstanding debt and the amount of money spent servicing balances is an important thing to think about at the close of each calendar year. Do you carry too much revolving debt, resulting in high service and interest charges each month? Have you secured the best available mortgage interest rate, all things considered? Is it possible for you to reduce the cost of servicing debts in your household?

It’s hard to get ahead when your cost of credit runs too high. With interest and fees swallowing your payments, there isn’t much left to reduce your principle balance, so progress is slow wiping debts. Assessing you finances at the end of the year may highlight opportunities to better balance the financing you need with cost-effective payments you can afford.

Several types of personal loans are available, offering better terms than some high-interest alternatives. You may be able to reduce your monthly debt costs by taking a consolidation loan or getting an unsecured personal loan to wipe a more expensive debt. And when fast, short-term funding is needed, you can compare several top lenders and apply online – without a deep credit check.

A Look Ahead

A look back at your financial year provides insight you can use to plan for the future. One immediate benefit of a year-end finance review is reflecting on errors you made, so you can avoid tripping over the same mistakes during the coming year. And closing the year with a look at your books gives you the information needed to project your spending and tax responsibilities for the months ahead, preparing you in advance for spending demands.

If your year was long on spending, yet short on budget restraint, creating a responsible spending plan should be one of the first tasks you tackle in the New Year. With a clear path to follow, based on lessons learned from your year-end financial wrap-up, you can improve your finances in the year ahead.

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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