Paper or online - which is better? Looking to improve my financial situation.

MovingForwards

@Ballard originally it started as my marriage broke down, I started over and was working to clear debt while saving to buy a home. I knew where everything (money) was going and come payday off it went, even savings are treated as another monthly bill. When I don't spend all of a budget I transfer the surplus to savings, deciding which pot it should go in.

Since purchasing my home I've carried on doing it this way as it works for me, it's also enabled me to start a SIPP a lot sooner than planned and increase my mortgage overpayments as I've an overview as to where my money is earmarked each payday.

Perhaps if I earned more I wouldn't do it like this, however it's enabled me to see early retirement is possible.

kuratowski

I totally agree with RG2015 and MovingForwards.  As a reader of FT.com and other sites as well as this one, I've seen it stated again and again that even high earners can lose control of their spending, and ultimately get themselves into a spiral of debt.  I was completely fine up until I bought my home and at that point I found myself spending on that quite heavily (as a lot of people do).  I found that once you get the habit of spending large amounts it's quite tricky to wean yourself off, and having a budget and tracking transactions was really helpful in breaking out of it.  I've kept the tracking going ever since, which helps to ensure I meet my long term savings objectives.

JordanJamesMatta88

RG2015 said:

MovingForwards said:

I have a spreadsheet for my income and outgoings. It's set up over Christmas for the following 12 months.
Another one for my savings, pensions, retirement pots and mortgage.

I also have a little book for my pensions and mortgage, not sure why but I do like picking it up; I also prefer physical books compared to eBooks, but happily surf the net.

Pre-covid I would also pay cash for shopping, petrol, general spends etc and have recently reverted back to it with some shops.

There's no right or wrong way, it's whatever works for you.

I have a NatWest credit card that gives me 1% back on all supermarket shopping and 0.25% on everything else. I get at least £5 per month and often over £10 in a month. There is a fee but that gets refunded if I have a reward current account which also earns me a further £3 net each month.

I also get up to 56 days from each purchase to having to pay off the card each month. And finally, I don’t have the bother of withdrawing and holding cash.

PS. To get back to this thread, my credit card statement records all spend by retailer which I download into a spreadsheet. I now have almost 10 years of data on this.

wow, this sounds very productive - where did you learn about all these tools/methods?

JordanJamesMatta88

Ballard said:

I genuinely don't mean this is an aggressive way. Keeping track of finances is a good thing to do but I don't feel the need. I don't spend money wantonly and don't get close to spending my salary every month. On payday I transfer the excess to a savings account and transfer some back as and when required. I do have some large bills coming up but I've been aware of them for some time and have the funds available. My monthly spend isn't smooth. This month, for instance, I've bought a few theatre tickets (although I did have a lot of credit with various theatres so the cash expenditure wasn't what it could have been).

My question is, what do people do with their projections? Do you use it to change your spending habits? Does it stop you spending?

I feel that I should repeat that this isn't meant as a judgement. Everyone should do as they feel best for them. I'm just curious. I rarely feel the need to look back to see what I spent my money on the previous month let alone ten years.

Edit: it's probably worth me pointing out that I do have a spreadsheet for my mortgage which projects the balance over time so I'm definitely not against financial planning.

I think I just need a budget to keep track of all my various outgoings including debt repayment. Perhaps my salary doesn't stretch as far as yours naturally and I'm looking to make the most of the remainder after various payments I need to make. I think you're in a strong position which i'm defo trying to get into and believe I can, I just need a little structure/organisation to get me there.

JordanJamesMatta88

Thanks all for the help - I think I might try an excel sheet for my income and regular outgoings as i think someone said I can change these when and if I need to. I might also try having some physical tick off payment chart or target savings per month to kinda visualise my progress - I've read a little online from a few sites and a combination of the two seems to help. 

I would definetly like to learn more about cash back cards and rewards - they always seem more complicated than they're worth but I would like to find out more.

ratechaser

JordanJamesMatta88 said:

Thanks all for the help - I think I might try an excel sheet for my income and regular outgoings as i think someone said I can change these when and if I need to. I might also try having some physical tick off payment chart or target savings per month to kinda visualise my progress - I've read a little online from a few sites and a combination of the two seems to help. 

I would definetly like to learn more about cash back cards and rewards - they always seem more complicated than they're worth but I would like to find out more.

I think the 2 key questions ahead of this are

1) What is that total amount of your current typical monthly outgoings that could be put on a credit card? So food, clothes, entertainment etc (but not mortgages, utilities etc that won't typically allow payment by credit card)?

2) If you put all those expenses on a credit card, would you have the discipline to set aside the money to pay it all off, every month, so you didn't get charged any interest?

Oh... and there's a third question - do you know if your credit FILE (not SCORE) is in good shape, with no missed payments, you are on the electoral roll etc etc? Because it needs to be squeaky clean to get a good cashback card.

Think all that through and then look at Amex's platinum cashback credit card - with the £125 possible introductory cashback, long term rate up to 1.25%, and a possible extra referral bonus if someone refers you (from my app, it looks like you could get £40 extra right now) - it can be a decent option...

BUT - it depends on how much you would spend on it and how much discipline you have to make sure you don't end up paying interest...

KxMx

I do a monthly spreadsheet as a spending diary and a hard backed notebook just for my main bank account - I have two others, 1 for long term savings & 1 for short/long term treats which are managed wholly online.

My spreadsheet starts as 12 sheets and every few months I'll make adjustments to the copied & pasted amounts, such as how many Mondays in the upcoming few months (day I pay savings) or whether my haircut falls in that particular month or not.

I have a low income and such accounting really helps me get the most out of my money and sort out priorities.

I started in 2015 because I couldn't work out why I hadn't got more after my fixed expenses. I soon saw why and wish I'd started sooner! 

RG2015

JordanJamesMatta88 said:

RG2015 said:

MovingForwards said:

I have a spreadsheet for my income and outgoings. It's set up over Christmas for the following 12 months.
Another one for my savings, pensions, retirement pots and mortgage.

I also have a little book for my pensions and mortgage, not sure why but I do like picking it up; I also prefer physical books compared to eBooks, but happily surf the net.

Pre-covid I would also pay cash for shopping, petrol, general spends etc and have recently reverted back to it with some shops.

There's no right or wrong way, it's whatever works for you.

I have a NatWest credit card that gives me 1% back on all supermarket shopping and 0.25% on everything else. I get at least £5 per month and often over £10 in a month. There is a fee but that gets refunded if I have a reward current account which also earns me a further £3 net each month.

I also get up to 56 days from each purchase to having to pay off the card each month. And finally, I don’t have the bother of withdrawing and holding cash.

PS. To get back to this thread, my credit card statement records all spend by retailer which I download into a spreadsheet. I now have almost 10 years of data on this.

wow, this sounds very productive - where did you learn about all these tools/methods?

These are not tools/methods simply financial products.

https://personal.natwest.com/personal/credit-cards/reward-credit-card.html
https://personal.natwest.com/personal/current-accounts/reward_account.html

Bear in mind what @ratechaser says. You need to have a good credit record to get a good cashback card and you must pay it off in full every month. Otherwise you will need to pay interest which will negate the cashback benefits.

Sign up for MSE Credit Club ( https://www.moneysavingexpert.com/creditclub/ ) which will give you your Experian credit report free and also an indication of best card offers. And while you're at it sign up for Credit Karma and Clearscore for your other two credit reports. 

https://www.moneysavingexpert.com/loans/check-free-credit-report/

And you may find the following useful for budgeting.

https://www.moneysavingexpert.com/family/money-help/
https://www.moneysavingexpert.com/banking/budget-planning/
https://www.moneyadviceservice.org.uk/en/tools/budget-planner

Ballard

It's been interesting to see why people use tools to account for their expenditure but I don't feel that I would benefit from something similar at this point in my life. I'm not a particularly high earner but I bought my first property quite young and had paid it off by the time I was 41. I've recently moved and have another mortgage but it's not particularly large so my disposable income is probably better than most people who have my income. Not having a car certainly helps in that respect too.

I log onto my accounts every day so see what I've spent my money on and that's good enough for me at the moment. Thanks for the explanations though. For those in different circumstances I can certainly see the benefit.

ratechaser

Ballard said:

It's been interesting to see why people use tools to account for their expenditure but I don't feel that I would benefit from something similar at this point in my life. I'm not a particularly high earner but I bought my first property quite young and had paid it off by the time I was 41. I've recently moved and have another mortgage but it's not particularly large so my disposable income is probably better than most people who have my income. Not having a car certainly helps in that respect too.

I log onto my accounts every day so see what I've spent my money on and that's good enough for me at the moment. Thanks for the explanations though. For those in different circumstances I can certainly see the benefit.

I'm a bit like you, never budget (although Mrs RC has a good solid set of ledgers where all transactions are transcribed...), what's left over after payday and calculated outgoings ends up in one savings pot or another. It's quite easy because virtually all spending goes on a credit card so one amount on a statement to pay off... as well as the established DDs for council tax and utilities.

Maybe I'm just lucky, but even so it doesn't stop me trying to scrape rewards, returns and discounts to the max. Could be a manifestation of OCD