5 simple ways to boost your financial confidence
From making use of budgeting tools to building your emergency fund, these small steps all help.
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Your support makes all the difference.Men are much more likely than women to feel confident in how they handle their finances, new research has revealed.
Nearly three-quarters (74%) of men say they feel confident in managing their money, compared with just two-thirds (66%) of women, according to a survey on behalf of Pay.UK, owner and operator of the Current Account Switch Service.
With women often bearing caring responsibilities, which could involve taking career breaks or going part-time, this can lead to some having less money to live on when it comes to their own pay and retirement pots too.
Despite seven in 10 (70%) people across the survey generally feeling confident about managing their personal finances, there were also found to be significant disparities across the UK.
For example, only 54% of people in Northern Ireland said they feel confident with managing everyday finances, the research found.
At the other end of the spectrum, around three-quarters (75%) of people in the South West and 74% in the North East of England said they feel financially confident. In Scotland, 67% of people feel financially confident, while in Wales 72% feel the same way.
So, how can you build up your own financial confidence and gain a better sense of control over your money?
John Dentry, product owner at the Current Account Switch Service, shares the following tips…
1. Take advantage of digital tools
“Many banks now offer apps that make managing your money simpler,” says Dentry.
“Track your spending, set up budgets, and receive real-time notifications to stay on top of your finances,” he suggests.
Some apps allow you to split your money into “pots” to help with budgeting, as well as “round ups” where small amounts of money are automatically deposited into savings.
Many pension providers also have apps and online tools to help people get an idea of what sort of income they could end up with in retirement.
2. Plan for emergencies
While it isn’t easy for everyone, building an emergency savings pot that you can dip into in an emergency is a valuable financial safety net. This might be losing your job, yourself or a loved one falling unwell, or a relationship breakdown – it’s always a good idea for everyone to have something put aside to cover themselves if their circumstances suddenly change.
Dentry suggests: “Start small but aim for savings that could cover at least three months’ worth of essential expenses.”
3. Review your current account
“Not all accounts are created equal,” says Dentry. “Some offer rewards like cashback, lower overdraft fees, or perks such as free cinema tickets. Review your options regularly to ensure you’re getting the most out of your account.”
4. Switch accounts if necessary
“If your bank isn’t meeting your needs, consider switching,” Dentry suggests.
The Current Account Switch Service can take the hassle out of switching by automatically moving payments over from the old account to the new account and offering a guarantee so switchers aren’t left out of pocket if anything goes wrong.
Many banks are currently offering cash to switch, but it’s important to consider how you will use the account overall when deciding if it’s right for you.
5. Maximise your savings potential
The Bank of England base rate has been cut twice this year, following a spate of hikes. With interest rates on a downward path, this could make the need to shop around for top savings deals even more pressing.
“Look for accounts that offer better interest rates or savings bonuses,” adds Dentry. “Even small savings gains can make a big difference in the long term, helping you to build financial security.”