That time of year has arrived again. How will you balance your finances in 2026?
Here are some ways to start reviewing your finances this January:
- Get a will or, if you have one, make sure it is up to date: If you die without a will, the rules of intestacy take over. These may be appropriate if you are a married couple with 2.1 children, but even then, they may not produce the result you would want. Equally, an out-of-date will could mean your wishes are not met.
- Do not ignore that Christmas credit card debt: Most credit card debt is expensive – even a high street bank card could be charging 25% interest, with store cards often charging more. You cannot earn 5% on your cash savings, so it will usually be better to pay down the debt than save.
- Have a trawl through your bank statements: You could find that annual subscription that you either forgot you had signed up for, or discover a monthly cash drain triggered by clicking the wrong button when internet shopping.
- Make a note of the renewal dates for your household insurance policies: Insurance companies would prefer that you renew their policies automatically. If you know when renewal is due, you can check the market beforehand and be ready to switch (or haggle).
- Check the interest rate you are earning on your cash savings: Banks and building societies frequently pay a higher interest rate to attract new savers than they offer to loyal customers. The new saver bait can include time-limited bonus rates: you probably need to leave when the bonus expires.
- Consider switching to a fixed rate deal for your energy bills: The 1st of January marked the start of a new Ofgem quarterly price cap for gas and electricity prices. If you are still on the standard variable tariff – which most people were after the 2022/23 energy crisis – you could save money and avoid the three-monthly tariff roller-coaster with a fixed rate offer.
The value of your investment and any income from it can go down as well as up and you may not get back the full amount you invested. All statements concerning the tax treatment of products and their benefits are based on our understanding of current tax law, financial planning strategies and HM Revenue and Customs practice. Levels and bases of tax relief are subject to change and vary according to individual circumstances. Investing in shares should be regarded as a long-term investment and should fit in with your overall attitude to risk and financial circumstances. Past performance does not guarantee future performance. Every effort has been made to ensure the information in this post is accurate at the time of publication. The Financial Conduct Authority does not regulate tax or will advice.