What are your 2025 money resolutions?

1. Work out a budget

Knowing exactly what’s coming in and going out of your account each month is the best way to take control of your finances. By going through your bank statements with a fine toothcomb, you’ll be able to see where you can make cutbacks, and how much you have available to spend each month without going into debt.

Malvee Vaja, financial adviser at Rathbones, said; “Good budgeting should include:

• calculating your expenses, particularly in terms of essential (mortgage/rent, food, household bills, etc) and discretionary spending (eating out, streaming services, gym membership, etc)
• keeping your essential money and discretionary spending funds in separate bank accounts or pots
• setting up direct debits for essential bills to go out on, or close to, pay day
• reviewing and managing your subscriptions. Many subscriptions auto-renew, so you may be paying for services you barely use or perhaps have even forgotten about.”

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2. Save more

If you struggle to save but want to get into the habit of putting money away regularly, downloading a mobile money app such as Moneybox or Plum could be a great way to get started. These apps can be linked to your current account so that you can ‘round-up’ any spending and then channel these round-ups into your savings. For example, let’s say you spend £36.40 at the supermarket. A savings app would round this up to £37, so you can channel the rounded-up 40p into your savings.

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3. Consider investing

Whilst having some savings which are easily accessible is vital, if you have any long-term financial goals, you might want to consider investing. Remember however, that investing is not without risk, so you’ll need to be comfortable seeing the value of your savings go down as well as up. Sarah Coles, head of personal finance at Hargreaves Lansdown, said: “Regular monthly savings are a great way to get into investments. You don’t need a large lump sum to get started, you don’t need to remember your good intentions every month, and they’re also a useful approach during times of volatility.

“By drip-feeding your money into stock market ISAs, you will take advantage of their downs as well as their ups, through what’s known as pound cost averaging. If you invest a fixed sum every month, you can buy more units when a fund’s value falls, providing the potential for greater profits when they have risen in value.”

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4. Write a will

If you haven’t already, it’s essential to write a will as soon as possible this New Year. Dying without one could leave your loved ones facing an administrative nightmare at what’s already likely to be a very difficult time.

Emma Sterland, chief financial planning director at wealth management firm Evelyn Partners, said: ‘If you don’t have a will then making one is often a huge step in establishing financial security and peace of mind for your family. It can prevent unnecessary stress and even disputes for the administrators and beneficiaries of an estate and could save them having to pay unnecessary inheritance bills.

“Having wills in place is especially crucial for unmarried couples in long-term relationships - as the intestacy rules could lead to an unwelcome distribution of assets at death - and for blended families where uncertainty and misunderstanding can arise.”

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5. Give your pension a boost

Many of us push retirement planning to the bottom of our priority lists as there are often more immediate issues to deal with. However, a bit of forward planning can make a big difference to the amount of income you end up with when you retire, so it’s well worth giving your pension some attention this New Year.

Alice Haine, personal finance analyst at Bestinvest, said: “Topping up a pension is a great way to slash your income tax burden because tax relief is applied to your pension contributions at your marginal rate of income tax. Basic rate taxpayers get 20% in tax relief added to their pot – delivering a 25% increase on their initial contribution - while higher rate taxpayers get a further 20% in tax relief and additional rate taxpayers an extra 25%. Remember, once the money is added to your pension, you cannot touch it until you are 55, or 57 from 2028.”