Black Friday, the festive season and Boxing Day sales can leave you entering the new year feeling financially a bit worse for wear… but it doesn’t have to stay that way. Start the year fresh with our tips on how to be financially savvy.

Assess your December spending
It’s a good idea to look over what you spent in December. Review your bank and credit card statements to identify areas where you may have overspent. You could even categorise your expenses to understand your spending habits.

Make sure to prioritise essential payments like your rent or mortgage, utilities and groceries, and make at least minimum payments on any debts to avoid late fees. If you overspent over the festive period, create a plan to tackle this. If you’re worried about debt, we can help.

Budget and save
Next, track your January expenses. Make a note of all your outgoings for the month, and check your income covers this. This is where you can identify if you can cut unnecessary spending like dinners out or unplanned purchases. Try cooking at home and prepping your meals to save some money. You could also try automating your savings. Set up a direct debit to transfer a portion of your income to savings as soon as you’re paid, or there are apps you can use to do this. Even a small amount can make a big difference!

Set goals
New year, new me…? Start the year fresh by creating SMART goals. This makes your goals Specific, Measurable, Achievable, Relevant, and Time-bound. It helps to break them into small steps. For example, one of your goals could be “Save £500 for a summer holiday by June by setting aside £100 monthly for 5 months.”

Avoid costly New Year fads
Skip the rush to join gyms or expensive diet plans in January. January promotions can pressure you to sign up impulsively. Instead, look for free or low-cost alternatives, like home workouts, outdoor activities, or community fitness classes, and only commit if you’re sure it fits your lifestyle.

Shop smart
Are there a few things in the shops you genuinely need? Wait for discounts or promotions before buying them. Write a list, set a budget for each thing and avoid impulse buys — especially during sales.

Be consumer savvy
Regretting a few of your sales purchases? Don’t worry, we’ve all been here. Check return policies. If the store offers a period of time to return an item, check the conditions and the date you need to return it by. Remember a store policy isn’t the same as your legal consumer rights.

Always be mindful of scams too, especially around busy shopping periods. There are lots of different types of scams emerging at the moment. Some examples to look out for include:

  • Fake QR codes, especially when paying for parking or discount codes
  • Sellers offering hugely discounted designer items or hard to come by items

Plan ahead
We get it, life can be unpredictable, but it helps to plan ahead where possible. Start saving for big life events for the year like birthdays, weddings, or holidays to avoid last-minute financial strain. Frequently check over recurring expenses like streaming services, insurance, and utilities. Cancel unused subscriptions and renegotiate rates where possible, but make sure to check for any cancellation fees.

Maximise income
Now’s a good time to declutter and sell unused clothes, toys, or gadgets. If you were gifted something over Christmas that wasn’t to your taste and can’t return it, consider reselling it. Just be mindful if the gift is from someone close!

Additionally, if your financial or personal circumstances have recently changed or are likely to change soon then it’s worth doing a benefits check to see if you’re entitled to any additional support. Want help to do this? Call our Watford team on 0800 144 8848.

Think long-term
There are lots of ways you can set yourself up for the future. Take a look at the best saving options — compare interest rates and different types of savings accounts. This can help grow your funds faster. If you’re not saving into a pension scheme, consider doing that this year. Most people get a state pension from the government which covers their basic needs. But it’s also a good idea to try and save some extra money in a pension fund. Our advice on this can help. If possible, start building an emergency fund if you don’t have one. Aim to save at least 3–6 months of essential expenses. Start small and gradually increase the amount.

Becoming financially savvy doesn’t happen overnight, but by taking small, intentional steps, you can make a big difference to your financial health. If you need more advice or help, visit our website for 24/7 self help or contact details for individual advice.

Blog by Cara Lewis, We Are Citizens Advice