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Claire Seal of @myfrugalyear: How to overcome overspending

Disclaimer: The contents of this article are for general information purposes only and do not constitute as first direct offering financial advice. Specialist advice should be taken in relation to specific circumstances. The views and opinions expressed are those of the author and do not necessarily reflect the views or opinions of first direct.

When Clare Seal reached what seemed like a breaking point in her relationship with money in spring 2019, she turned to Instagram to make herself accountable, posting anonymously about her journey out of debt as @myfrugalyear. She immediately struck a chord, and in just one year found a following of 45k people. A new voice on the finance scene, Clare recently released her first book Real Life Money: The Journal. It’s a practical workbook, targeting the link between our emotional wellbeing and our financial situation. 

We’re working with Clare Seal of @myfrugalyear on Instagram to share practical tips and advice to help you feel happy, confident and in control of your money.

Is your recent spending keeping you up at night?

The aftermath of a big financial outlay like Christmas can cause financial worry and anxiety at the best of times, but following one of the strangest years that many of us have ever experienced, those feelings might be more intense.

Many of us had seen Christmas as the light at the end of a very long tunnel – hopefully a chance to celebrate with those who mean the most to us. For others, the pressure was high to compensate for months of missing out, by splashing out on bigger and more elaborate gifts. You might now be left with a bigger bill or hole in our savings than you had planned for.

There are all feelings that I’m very familiar with

Having struggled to have a healthy relationship with spending for most of my adult life, in March 2019, following maternity leave and a Christmas that I couldn’t really afford, I found myself at a breaking point and subsequent turning point in my relationship with money.

After ten years of spending beyond my means – sometimes just by a little each month, I was faced with over £27,000 of credit card and overdraft debt, and our monthly family finances were stretched so tightly that I wasn’t sure how we would ever manage to create a healthier financial picture. I had always relied on the next pay rise or bonus to help us to resolve things, but all that happened was that the extra money seemed to disappear, leaving us in exactly the same position. 

My husband and I were both about to start slightly better paid jobs, and my eldest son was about to start school, reducing our childcare costs. But I knew from experience that the extra income would just vanish if I didn’t do some serious work on my habits and relationship with money. 

Since then, my life has changed dramatically

In terms of my personal journey, I now have a much steadier approach to my finances, better habits, and our debt is very nearly paid off – so I’d love to share some tips with you for making now your turning point, and creating a better relationship with money for the new year.

What I’ve learned over the last couple of years is that it’s important that we don’t allow ourselves to get caught up in feelings of guilt or regret about overspending, particularly at Christmas, and instead we look at the steps we can take to look after our financial wellbeing and build a better relationship with money for the future.

Here are a few practical things you can do right now to make sure that you get off to a positive start this year:

1.    Draw a line under any overspending

Once you feel like you’ve already overspent, it can be very easy to continue spending – particularly as the January sales arrive and temptation is still all around. Continuing to spend even when you’re worrying about money is, in my own personal experience, very normal – but it can cause even more stress in the long term.

Drawing a line under damaging spending habits is about accepting and forgiving yourself for any money mistakes that you might have made in the heady Christmas season, and not continuing those patterns of behaviour into the new year. 

Used wisely, a credit card can help with your cash flow and build your credit score, but it’s important to know your stuff and have a plan to pay it back. So, if you’ve borrowed on a credit card or overdraft, as many people do at Christmas, now is a good time to make a realistic plan to repay what you owe in an affordable way. 

2.    Don’t bury your head in the sand

As tempting as it is to put any financial worries to the back of your mind, all that usually happens is that they grow in size and become more and more daunting to deal with. I took this ostrich approach for a very long time and the worry that built up at the back of my mind became more and more difficult to deal with: to the point where money was the last thing I thought about before I went to sleep, and the first thing on my mind when I woke up in the morning.

A really great habit to get into for the new year is checking in on your finances on a weekly basis, and to make it something enjoyable – or at least bearable. Choose a time when you’re as free of other stresses as possible and treat it as an act of self-care, because it’s really difficult to feel good if you’re worrying about money.

3.    Make a plan

Making sure you’re aware of any shortfalls in your budget or upcoming bills is important for both your peace of mind and your bank balance, because then you can do something about it. 

Living with a budget is one of the best ways you can protect and enhance your financial wellbeing. For a very long time, I went from month to month without any kind of plan and saw budgeting as boring and restrictive – something to be endured for a short amount of time to achieve a specific goal.

But it doesn’t have to be that way. Your budget can be your ultimate tool for working out what you can say yes to in life, without dealing with the financial fallout afterwards. 

In order to feel more relaxed and in control of your finances in 2021, it’s a good idea to sit down and run through your income and outgoings, ditching any unused subscriptions and checking where you can be making savings. Then, the most important part? Keep going. 

4.    Communicate with your bank

If you’re worried about money, or you’re not sure where to start, it’s always a good idea to speak to your bank about any options that are open to you, or any ways that they can help you.

January can be strange and disorientating – but don’t let your post-Christmas finances be yet another weight on your mind. You deserve a fresh start in 2021, and the best way to do that is with a plan that works for you.