So how can you turn Blue Monday into ‘New Monday’ – a day when you do something positive? Taking steps to improve your finances is a good start, experts suggest.
Here are five tips to do just that.
Get a budget in place
Myron Jobson, senior personal finance analyst at investment platform Interactive Investor, said January is the perfect time to give your finances a boost.
“Create a budget for yourself that reflects your income and expenses. Budgets aren’t a one-size-fits-all approach and will depend on your personal financial circumstances.
“Track everything that you’re spending and the money that’s coming into your account. Then, you should identify areas where you can reduce spending easily, without compromising your essential needs. Anywhere where you can limit discretionary expenses is key.
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“Once you have a budget in place, you should also look at where you could implement spending limits to make sure you don’t exceed your budget,” he said.
Kick off a savings challenge
Aileen Robertson, head of savings at Atom Bank, suggested starting a savings challenge to help you feel better about your finances. These challenges have become popular on social media, and can help you to amass a pot of money more quickly.
“An easy way to start is by starting weekly with the 52-week challenge. You save an amount that matches the week number in the year; for example, in week one, you save £1, and by week 52, you save £52. By the end of the challenge, you’ll have built up a savings pot of £1,378,” Robertson said.
Track down your pensions
Thinking about your future could help you to feel more in control. Emma Watkins, managing director of Scottish Widows, suggested being proactive this Blue Monday and tracking down lost pensions.
“It’s luckily a lot easier these days with the Government’s Pension Tracing Service, which does most of the work for you so long as you provide your National Insurance number and the names of your former employers.
“With the Pensions Policy Institute estimating that around 27 million pots will be lost in 10 years’ time, you may find yourself surprised with more retirement contributions than you expected, especially if you’ve job-hopped a lot,” she said.
The Pension Tracing Service can be found here.
Spot and blitz expenses
Kevin Mountford, founder of savings platform Raisin, said Blue Monday is a great day to go through your finances and spot the hidden drains on your income that are costing you over £1,000 per year.
“Just a few strategic changes can help households hang on to more of their cash,” he said.
He suggested spending some time today cancelling subscriptions, which he says waste an average of £168 per year, as well as canning playing the National Lottery, which he said raises £3.44bn every year through the losses of the households playing it – £121 per household in the country.
Set goals
Make today positive by spending five minutes setting financial goals, suggested Watkins.
“Putting ‘pen to paper’ and actually writing down what you want for your future can be a good exercise to help you visualise the bigger picture.
“When it comes to pension planning, start by asking yourself what you’d like to be doing when you get older. For example, is your priority stopping work as soon as possible or do you not mind working longer to have a more comfortable lifestyle later on when you do decide to retire? This will help you come up with achievable goals for the long and short term,” she said.
