In these challenging financial times, it’s important to keep track of your financial position and stay on top of your paperwork and administration.
Rather than doing it in a rush at the end of the year, it can be much easier to stay on the ball throughout the year. Taking care of your finances at regular intervals can also save you time and makes it less likely you’ll miss any important deadlines.
Take a whistle-stop tour through 2023 and discover one personal finance tip for each month.
January: Sort out your self-assessment tax return
Your self-assessment tax return for 2021/22, is due, at the latest, by the end of January.
If you haven’t done it already, make a start as soon as you can. Better this than having to do it in a rush just before midnight on 31 January.
You’ll also need to pay any outstanding tax immediately, so make sure you have funds accessible for this.
February: Warm yourself up by planning your summer holiday
February is often the coldest month of the year. Even though the days are slowly beginning to get longer it certainly doesn’t seem like it when you look out on the snow and ice.
So, this month is an ideal time to cheer yourself up by planning your summer holiday and giving yourself and your family something to look forward to.
Importantly, it also gives you time to start setting money aside to pay any balance due, and for holiday spending money.
March: Get your end of tax year finances in order
The 2022/23 tax year ends on 5 April, so March is a good time to focus on your end of tax year arrangements.
Check what you’ve paid into your pension and ISA in the tax year so far and see if there’s sufficient scope for you to make additional payments. These are both highly tax-efficient so, if you can, it’s worth maximising your contributions.
If you’ve used all of your pension Annual Allowance, don’t forget you may be able to “carry forward” any unused allowance from the three previous tax years.
April: Sort out your 2022/23 tax return
The start of the new tax year is the ideal time to start completing your 2022/23 tax return.
It means one less thing to have to worry about later in the year, and gives you time to arrange your finances if you have any tax to pay to HMRC.
Another, often overlooked, advantage of getting your return done immediately is that if you’re due a tax refund you’ll get the money in your account much more quickly than if you’d left it until later in the year.
Likewise, if you’re claiming higher- or additional-rate pension tax relief, you can get this invested and working for you as soon as possible.
May: Give your financial records a spring-clean
With the weather starting to get warmer, May is the perfect time to give your financial records a quick spring-clean.
Check all your paperwork is up to date and filed correctly. Also, make sure all your direct debits and standing orders are collecting the right amount.
June: Time for a quick half-year review of your investments
Halfway through the year is the ideal time to review all your investment holdings – both in your pension fund and other savings and investment accounts.
It doesn’t have to be too detailed. Just check you’re happy with the funds you’re invested in, and that the correct amounts are being paid from mandates you have set up.
If you’re contributing to your pension through your employer’s pension scheme, make sure the right amount is being taken by checking your latest payslip.
July: Check your life cover
It’s the start of the school holidays, when you’ll probably be spending a lot of time with your loved ones, so this is the perfect time to take a look at your life insurance cover.
Check that the amount your family and loved ones will receive is enough, should the worst happen. At the very least, make sure it would be enough to pay off your mortgage.
Read more: Protection plays a key role in financial planning. Here’s why and what to consider
Ideally it should also provide a sum large enough to supply them with an income for a certain period while they adjust to life without you and make plans for the future.
August: Review your emergency fund
August is usually the warmest month of the year, so this month’s tip is very simple, leaving you more time for fun in the sun.
Check your emergency fund to be sure there’s enough in it. The general rule of thumb is that it should be enough to cover between three- to six-months of your household expenditure.
Also make sure you’re getting the best interest rate you can on it. While it clearly needs to be in an easy access savings account, check a comparison website to ensure you’re getting a decent rate.
September: At the start of the school year, think about education costs
The new school year starts this month, so September is a good time to think about future school fees and university funding for your children.
By starting to save as soon as you can, you’ll be able to help offset the cost of private education and university tuition fees.
If your time frame is five years or more, you should consider investing the money you set aside rather than simply relying on interest on your cash savings.
October: Remember the scary financial mistakes you need to avoid
In our Halloween article back in October, we listed seven scary financial mistakes you need to avoid making.
These included not prioritising clearing your debt and failing to have a will in place.
Have a quick read through the article to make sure you aren’t making any frightening mistakes.
November: Give your disposable income level a timely boost before Christmas
The cost of Christmas can put a strain on your finances.
So, take a look through your regular outgoings and see what you might be able to cancel to free up some disposable income.
Do you really still need that gym membership, and all those subscription TV services?
December: At the end of the year, review your financial position
The end of the year is the ideal time to give yourself a financial health check.
Follow the steps in this financial MOT article and you should be in great shape going into the new year.
Get in touch
If you need help or advice regarding any of the financial issues you’ve read about here, please get in touch.
Email email@example.com or call us on 0800 055 6585.
The information contained in this article is based on the opinion of LEBC Group Ltd and does not constitute financial advice or a recommendation to any investment or retirement strategy.
You should seek independent financial advice before embarking on any course of action. All contents are based on our understanding of HMRC legislation, which is subject to change.
A pension is a long-term investment. The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available.
Your pension income could also be affected by the interest rates at the time you take your benefits. The tax implications of pension withdrawals will be based on your individual circumstances, tax legislation and regulation, which are subject to change in the future.
The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.