Thinking of transforming your finances in Lockdown? You aren’t the only one!
Whether you’re working from home or have just been spending a lot more of your downtime where you live – we’ve all been spending far more time at home than we ever have.
We as a nation have had to adapt to a multitude of changes to our lives in such a short space of time – and with the looming threat of another possible lockdown, it could seem like we may have to adapt to many more.
During the end of March to the beginning of August, overall spending went up by a staggering 17% – which may not be all that surprising, considering the toilet roll panic buying and the increase in the number of people trying to keep themselves entertained at home during the pandemic.
Still, DIY and home improvement sales increased by 74%, and it would seem like our homes weren’t the only thing we were trying to transform during lockdown either.
And interestingly enough, while sales for takeaways brands, video streaming subscriptions and greetings cards increased, so did the number of people spending money on their finances and not in the way you might think!
During the lockdown, Fablious users were spending 47% more during the lockdown period than they were previously on budgeting and credit reporting services, with lockdown statistics showing a whopping increase of 51% in the number of transactions taking place.
What prompted such a massive shift in our spending habits, in particular with our finances?
The unfortunate thing about lockdown is that many people and industries have suffered significantly. The UK public spent 87% less on eating out during the lockdown months while restaurants were closed and 51% less on transportation costs. Many of these changes in spending are to due to the fact that many were forced to socialise online and work from home instead of commuting into the office.
Why are people spending their money on budgeting and credit reporting services?
What the upturn in looking after your personal finance shows, is that many people are seeing an increase in their disposable income, and are instead spending more of their hard-earned money bettering themselves and their financial position for the future.
By using budgeting software and apps – users can effectively track their spending, see areas of their expenditure for improvement and stretch their budget that bit further, saving more money during these uncertain times.
By using credit reporting services – users can keep track of their credit reports to see how they would appear to lenders and could improve their scores even further to widen their financial prospects at present and for the future.
Why should you look after your finances?
Making sure that your finances are in order can help you massively in the long run. As budgeting more effectively can help you to have more money at the end of each month and checking your credit report frequently can help you to understand the way your finances affect your credit and how creditors see you.
Looking after your finances is essential – especially if you’re seeking to get a mortgage, borrow money or even buy a car, it matters!
How can I improve my finances?
If you’re worried because you’re finding yourself with not enough money to put away in your savings account each month, then here are just some of the best ways you can get your finances in check and save money:
Check your credit file
Checking your credit report regularly is excellent for many reasons. As not only can you get a better understanding of how you appear financially to lenders but you’ll also be able to do things such as making sure there are no outstanding debts at previous addresses or fraudulent activity on any of your accounts.
Start budgeting each month
There are plenty of ways available for you to create a budget each month and stick to it. With apps and cards aplenty, there’s no excuse for you not to. All you need to do is sit down and work out a budget that will allow you to have enough money at the end of each month to put in your savings pot, once you’ve paid all your bills and expenses.
Analyse your monthly subscriptions
If you’re not using your music subscription enough because you’re not commuting to work anymore or you don’t have the time to watch Netflix every night, cancel your subscription straight away. Don’t kid yourself that you’ll use it and cut ties as soon as you can, that way your wallet will thank you.
Make repaying your debts a priority
We’ve all done it, put off paying our debts because we wanted or needed something more than we wanted to pay our bills – but it doesn’t pay in the long run. Interest on things such as personal loans and credit cards can soon amount and leave you struggling to repay, which is why it’s always important to prioritise paying off your debts as quickly as possible.
Set yourself some long term goals
Saving the deposit for a mortgage or maybe a new car? Set yourself a time frame to do so and go for it. Having a long-term goal to work towards can help you to stay on track and stay motivated – so set yourself some long and even some short term goals to help you stay on track.
Get yourself on the electoral register
If you aren’t already – you should be registered to vote in the UK elections. What’s the relationship between finances and registering to vote? If there’s no record of you at your current or previous addresses, then lenders may be more cautious about lending you money.
Make sure you’re getting the best deal
Double-check your council tax band and energy tariffs to ensure that you’re not paying more than you should be. You can check your council tax band by visiting the Government website or by getting in touch with your local council. You can check to see whether you’re getting the best energy deal from your supplier by using a price comparison website or auto-switching service.
Now that you know how others have been taking care of their finances during the lockdown, what ways have your spending changed during the UK’s lockdown and do you have any genius ways of saving money or getting your finances back on track?