How to take care of yourself & your wallet in January

A version of the phrase ‘wealth is health’ has been attributed to many notable people, including American philosopher Ralph Waldo Emerson, Roman poet Virgil and even activist Mahatma Gandhi.

Never have these words been more true, especially as we enter a new year trying to balance various aspects of our lives. Our wellbeing is intrinsically linked to our fiscal state, as confirmed by a St James’s Place Financial Health report.

The financial advice company found 46% of people taking part in its study felt their physical wellbeing had suffered as a result of financial stress, saying it was the cause of hair loss, weight issues and an overall sense of ageing. 

Additionally, 21% had considered taking time off work due to financial stress, with 13% suffering from depression as a result. Young people appear to be particularly vulnerable, with 66% of 18 to 34-year-olds saying their mental and physical health was impacted by their finances.  

The latest Close Brothers financial wellbeing index also found financial concerns are impacting employees’ mental health, with 87% admitting money worries had started to affect their work.  

With January a notoriously difficult month for finances – post-Christmas overspending, a long stretch between paydays, holiday adverts splashed everywhere and the temptation of the January sales – Viewber is sharing some useful ‘wallet wellbeing’ advice. 

Set up & contribute to an emergency fund: you can avoid the feeling of dread that accompanies an unexpected bill by creating an emergency fund – a cash reserve that’s specifically set aside for unplanned expenses or financial emergencies. Set up a standing order to a separate account, transferring a regular amount every month.

Track your spending: get a real grip on your finances by tracking everything that’s incoming and outgoing. You can use an app, such as Emma, Moneyhub or Money Dashboard, or go old school and create a spreadsheet. This should help identify overspending or highlight any surplus that could be used to pay off debt or be saved.

Create a realistic budget: once you have tracked your spending it will be easier to set and stick to a realistic budget. The golden rule is 50/30/20 – 50% to needs (rent/mortgage, bills, childcare and food, for example), 30% to wants (extravagances that are nice to have but could cut back, such as holidays, beauty appointments and eating out) and 20% to savings (including pensions, ISAs and an emergency fund).

Prioritise debts: clearing debts should fall into your ‘needs’ allocation as you’ll be racking up interest with every day that passes. Additionally, falling behind with repayments will damage your credit score. Consider a debt consolidation plan in the most overwhelming of instances, as this can make debt repayment more manageable.

Avoid ‘buy now, pay later’ purchases: although they sound appealing, the ‘buy now, pay later’ schemes offered by the likes of Klarna, Clearpay and Laybuy encourage people to overspend. Along with ‘pay in 3 monthly instalment’ options, ‘buy now, pay later’ schemes are a form of credit, with financial penalties and interest applied to missed payments.

Set goals & save for big-ticket purchases: instead of whacking a holiday or a new TV on a credit card – which may put pressure on finances for months to come – set clear financial goals and save towards them before you splurge. Put money aside in a high interest account and make big-ticket purchases when you can completely cover the cost, without using credit.

Speak to a specialist: don’t let money worries build as they will affect your mental health. Speak to a financial planner or debt advisor as soon as things feel out of control. The National Debtline, Citizens Advice, PayPlan, StepChange Debt Charity, MoneyPlus Advice, Money Wellness and the Debt Advice Foundation are all Government-recommended organisations who can help get your finances back on track.

Find out if your employer has a financial wellbeing strategy: many companies now offer employees a financial wellbeing strategy. If in place, this will provide support and education to staff so they can make long-term improvements to their financial understanding and spending habits.

Plan for your retirement: retirement can feel like a dark cloud on the horizon – a small but worrying niggle, even if it’s years away. In 2024, Wealth at Work found 39% of employees think they will never be able to retire, with 81% concerned they will have to work longer. Speaking to a pension adviser as soon as possible will help you plan for your future and reduce retirement stress.

6 tips for financial wellbeing 

1. Use standing orders – save automatically by setting up a standing order to an ISA or account with a high interest rate. Do this and you’ll never skip a savings payment.
2. Set up a limited access account – if you’re always dipping into your savings, consider opening a limited access account. This will restrict the amount of times you can withdraw money in a year, helping you reach your saving goals.
3. Use saving pots – many savings accounts allow the user to set up saving pots for specific goals. This can help motivate and focus the saver, as they can see how close they are to achieving their goal.
4. Cancel unwanted direct debits – stop money automatically being drained from your account by cancelling direct debits for things you don’t need, such as beauty subscriptions or gym memberships.
5. Close credit cards: while some people freeze cards in blocks of ice or hand them to a friend, the best way to avoid credit card spending is to close the account and cut up the card.
6. Track when 0% interest-free periods expire: if you do have a finance agreement that is interest free, check when it expires. It’s common for a credit card’s 0% interest free period to expire after 12 or 18 months, after which it’ll automatically flip to a very high interest rate.

If your finances need a boost in 2025 – whether that’s reducing fixed overheads at work or starting a side hustle to earn a few extra pounds, talk to us.