December is a lovely time of year, as we reflect on the end of one year and take a view on the year ahead. Finances have been turned upside down in 2022 and this looks like leading to uncertainty into 2023 and beyond. A positive that may come out of the inflationary rises and rates pressure is that more people are taking stock of where they are and where they want to be.

For a few years I lectured to workplaces on personal finance. I was often amazed at the number of people who didn’t review their bank statements, many didn’t open their payslips. We all work hard to earn our income – it is very important to then manage and plan with our money. The starting point for this, is to take time, even an hour to look initially at your assets and liabilities, then break this down into what you are earning and spending on a monthly basis.

We watch the government issue budget statements based on GDP and borrowing. This is just a more complicated version of what we can do in our own home. A personal budget review looks at all income sources, salary, benefits savings etc and where we are spending – food, fuel, energy, right down to impulse outgoings. The government aren’t breaking even and are borrowing billions every month, hopefully on an individual home basis we can break even. It is only by checking and reviewing we can build a picture of where we are.

Tackle bad debts first – credit cards, personal loans as credit rates are usually higher, some cards are 30% apr. Then check how your mortgage rate compares to the best savings rates on offer, however if you have a fixed rate due to mature, it is important to think about what your revised mortgage payment may be. A financial review helps in this area, as I can take time to sit and review what areas we can possibly address.

One hint right away is to think about Christmas 2023. Banks have launched a host of regular savings accounts with rates up to 5%. These allow for monthly capped payments over a year and may be the perfect place to start saving. Many high street banks allow up to £250pm saving, even a monthly saving of £125, gives you £1500 plus approx £36 interest, which should cover the Christmas expenses in 2023.

Yes tough times may be ahead, but the housing market is robust as are the British people. Now is the time though to take stock, take a breath and take sound financial advice.