Lifestyle Guides

How you and your family can take control of your finances

Having good money skills is essential to living a healthy adult life. We've teamed up with personal finance expert Mrs Mummypenny to bring you a few basic considerations and tasks to do that will enable you to get in better control of your finances

mother and daughter looking at laptop

It really is worth spending a couple of hours focussing on some financial admin every few months, not just to understand where you are at financially, but to also work on bill savings and to plan for the future. 

I've highlighted some tips and tools that can really help you manage your finances successfully:

The Spending Diary

All money management should start with keeping a spending diary. I love a spending diary, so much that I share mine every week on my website Mrs Mummypenny.

Keep your spending diary as you see fit, maybe use a notebook, or a spreadsheet. Keep it updated every day with ALL your spending from all your different accounts, cards, PayPal and cash. I include absolutely everything: monthly bills, big essential purchases, little purchases, (coffee, food etc), business purchases, savings & investment account transfers, pension contributions. 

Every Monday morning, I go through these transactions and allocate them across spending categories:  groceries, eating out, fun money (nails, massage, books, etc), children’s essentials, clothing, animal costs, personal health, etc. 

You can download a copy of my spending diary template if you would rather use mine and not recreate what I have already invented.

Keep your spending diary for several weeks to really understand where you spend your money and how. Do you notice emotional spending patterns, a middle of the night Amazon splurge or a Superdrug makeup haul?

You can then use this real-life spending information to create your budget. The next stage of simple personal finance.

Create A Realistic Budget

You now have all the of information of your actual spending to create a simple budget. Again, I have already done the heavy lifting and have created a budget spreadsheet for you, with all the categories and formulas that add up. 

Your budget will include your monthly expenses: your regular essential bills, your non-essential bills, your card, cash spending on food, eating out, socialising, the things that vary every month. There will also be an allocation for irregular costs such as dentist, haircuts, holidays, birthdays and Christmas that must be accounted for each month. Plus, money that you put into debt repayment or savings. 

You then add up all your outgoings and compare to your income. Hopefully, income is more than expenditure, but for many of us it isn’t, and you might be getting deeper into debt. 

Take Action

Go through your direct debits, which ones can you cancel? Be honest with yourself, do you really need Amazon Prime, Netflix and Disney+? Maybe not. Are you using that gym membership enough to warrant the £60 monthly fee?

Next go through your bills, can you get a better deal? Look at switching your broadband, energy, car insurance, mobile phone to save money. Enormous potential to save money here, just imagine shaving £100 a month off your essential bill just by switching to a new service provider, this is £1,200 per year. When will two hours of research ever earn you £1,200?

Next look at you irregular monthly spending on groceries, take away, fun money. If you are spending £300 a month on groceries, can you put £250 in your new budget to save money. Switch to a cheaper supermarket like Aldi or Lidl and save a fortune. A straightforward way to save money is on eating out, do more home cooking and order less takeaways.

Finally allocate budget to your quarterly, annual event spending. This money can be put aside every month into a savings pot, a useful tool in app-based banks such as Monzo.

Next you can look at your debt repayment and savings. Can you now afford to pay more per month off your debt or can you put more into your savings? 

Going through this straightforward process that will take you a couple of hours and is so worth it. 

Student Loans

Student loans are not a typical form of debt. I prefer to think of them as a tax on your earnings for the privilege of going to university and getting that incredible degree. The interest rate is low, and you must earn a certain level of annual income before it is repaid. It is an extra deduction that is taken from your salary before your take home pay. Just like a pension contribution or travel ticket loan.

What if you have Consumer debt?

We must address the subject of debt and speak about it with positive words and no shame. Debt is common, so many people have debt, some have it under control, many don’t. Unmanageable debt is a huge cause of mental health issues in the UK, mainly because people suffer in silence, pay off minimum payments, are charged extremely high interest charges and don’t ask for help. 

If you are in debt and need help, please reach out. Talk to a friend, show them your spending diary and your budget and ask for their view. They might be able to spot extra savings that you can’t see, a different perspective is impactful. Do your research and know your options – It might be worth consolidating your debt to a loan with a lower interest rate or switching to a 0% credit card if your credit rating allows it.

If you are struggling with your debt and cannot afford minimum payments or cannot afford to pay things like mortgage, rent, council tax then its time to talk to a debt charity. Step Change, Citizen’s Advice Bureau, and Christians Against Poverty are incredible charities who will help you. You can visit Money Helper which is a free service provided by the Money and Pensions Service which has budgeting tools and debt advice. There is always a solution to whatever financial difficulties you might have.

Credit Cards

I am not anti-credit card in any way. They can be used in emergencies, as long as you have a plan to make the repayments and you can use them on a monthly basis to benefit from cash back benefits, Avios miles and consumer protection. I have a Mastercard and American Express card for all these reasons and pay off the balance in full each month. You must go through a credit check process to take out a credit card.

But I have also had significant levels of debt throughout much of my adult life. Back in 2017 I came clean and added up the debt on four credits cards, only to realise that I had £16k of credit card debt. Then ensued a two-year journey to pay off that consumer debt becoming debt free in April 2019. 

Buy Now Pay Later

Buy Now Pay Later actually counts as a debt. It might not feel like it when they offer you the product, but it means that you don’t have to pay for you shoes, dress or make up until 30 to 90 days later, so  be careful with the amounts you owe on these type of services. This is an unregulated industry at the time of writing in 2021, and they do not perform credit checks on you to see if you can afford the repayments. It is easy to get into a financial mess with lots of these payment arrangements in place, and if you miss a payment it will impact on your credit rating.

Your Credit rating

This is an important financial tool that banks, and lenders will check to see how likely you are to repay the credit or loan for which you are applying. There are three agencies Experian, Equifax and TransUnion. 

Your credit file builds with good financial history, regular on time debt repayment, staying well within credit limits, not applying for new credit too often. It is checked in many situations that you might not expect, energy bill account set up, bank account set up, mortgage application, car loan application and mobile phone applications to name a few. 

Check your credit score for free with each of these agencies to understand what your credit rating is and how it impacts on the credit products you can apply for, and the interest rates you might be offered. The higher the rating, generally, the better the interest rate and you may also be able to borrow more, following checks and an affordability assessment. 


Before kicking off a major savings journey it is important to firstly clear your debt. The first savings pot to focus on is your emergency savings. A post of money set aside for emergencies, things like the car breaking down, needing a new dishwasher. It not a saving pot for wants, clothes, holidays, nice to have things. Set aside three to six months of essentials bills into a separate savings account. I like to use a whole separate bank to my current account. This money needs to be immediately accessible in an instant access account. The interest rate won’t be great now.

Medium to Long Term Savings

Once your emergency savings are in place then its time to think about medium- and longer-term savings. Medium term savings might include saving up for a house, a car or home improvements. Look at savings vehicles such as a LISA (lifetime ISA) for buying your first property (and getting a 25% bonus from the government in the process). 

Longer terms savings include stocks and shares ISAs and pensions. A stocks and shares ISA is suitable when you know that you won’t need the money for at least five years as it is linked to the rise and fall of the stock market. Your pension is brilliant tax saving vehicle for your future financial self, but it cannot be accessed until later in life, 55 now, likely raising to 57 from 2028. 

As you have read good money skills are 100% achievable with some time and focus. And it’s not complex, keeping the simple spending diary and creating a realistic budget are key to understanding your personal finances. Then flows all the stages of personal finance, paying off debt, creation of emergency savings and then longer terms savings. Thank you for reading.

Lynn is a personal finance expert and founder of Mrs Mummypenny. You can follow her on Instagram here, or on Twitter here.

Lynn Beattie is a personal finance expert and founder of Mrs Mummypenny. Her background is an ACMA management accountant of 17 years with a breath of experience working in commercial finance for Tesco, EE & HSBC. She is a single mum to three boys, living in Hertfordshire.

She left the corporate world in 2015 to run Mrs Mummypenny full-time. Lynn features regularly on campaigns for PensionBee, Zopa Bank, AMEX and Smart Energy GB. Also featuring regularly in the media including The Financial Times, The Sun, iWeekend and BBC TV/Radio. She presents a weekly Podcast/YouTube series, Mrs Mummypenny Talks. Lynn is the author of 'The Money Guide to Transform Your Life' published 1st Sept 2020.

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