With Christmas over and another year looming, it's time once again to check our bank balances and shudder at the thought of how much December has cost.
This year you can spend more wisely with our three simple steps – Plan, Compare & Review.
By planning your spending effectively at the start of each year, you can help to avoid those dreaded impulse purchases that wreak havoc on your credit card and improve your overall financial position.
The first step of planning is creating a simple budget of how much you expect to receive in income for your family against how much you expect to spend. Include everything and leave out nothing – those £2 lattes soon add up.
After assessing the bills you can quickly see how much disposable income you have left to spend on life's luxuries such as holidays and new cards. If there's not enough for your dream holiday, you may have to see where you can save money elsewhere to pay for it.
If you're in the very fortunate position of having a surplus after accounting for all of your costs for the year, by planning ahead you can also benefit from moving your money around to get the best interest rates as many require you to lock in for a set period to get the best deals. New concepts such as peer to peer lending can offer much better returns than high street banks and planning ahead really helps you to benefit the most.
Compare everything you plan to buy so you know you're getting the best deal. Every pound you save can be used to bolster the bank balance or treat yourself to an extra cocktail on your holiday.
You can compare your supermarket shopping with MySupermarket, save hundreds of pounds by comparing insurance of all types on sites like MoneySupermarket and use sites such as Skyscanner to compare travel costs.
In recent years the government has paid a particular focus on trying to make switching easier, so most of the work for example with moving to a new energy supplier is done by the companies. You just have to compare, find the best deal and then confirm you'd like to make the switch.
For other products (especially purchases more than £10) you should use price comparison sites like Shopzilla to see the price on offer at a variety of UK retailers. These few seconds of comparing prices are worth it based on the returns you'll get in total. Our parents and those before used the exact same principle by walking the high street to find the best value for money. We're now all lucky enough to be able to do it from the comfort of an arm chair with our tablet or smartphone.
After you've planned your annual costs and shopped around to get the best deal, the work doesn't stop there. You should regularly review your costs and the contracts you have in place to see if they're still right for you.
For example do you still need that gym membership in March if you've only gone once since January? It may be a slight ego boost that you're signed up to a gym but it's an expensive one at that.
Do you need those extra thousand texts provided by your mobile operator or are you generally using free services likes Whatsapp? Do you still drive 10,000 miles a year in your car or are you using it just at the weekends?
Reviewing our habits is something very few of us tend to do, but it's one of the main ways we can spend more wisely each year. We're creatures of habit and like to think we don't change huge amounts – and most of us don't. However, the world around us does and new technologies have completely changed how we consume the world. Make sure you're one of the people benefitting from this and you'll be surprised at how much you could save by being honest about what allowances you actually need in your life.