At Loqbox, we know that learning about finance is one of the best things you can do to make your financial future merrier and brighter. From understanding the language to making informed decisions, nailing your financial literacy is a super important part of navigating the system, which can have a huge impact on our lives. Knowledge is power, after all.
‘Tis the season of giving and this year, we’re gifting knowledge (woo!). Welcome to the financial literacy advent calendar.
Each weekday up until the holidays, we’ll be sharing a new tip, blog or action you can use to improve your money know-how, and head into the new year ready to achieve your goals. Almost better than opening a cardboard door to a tiny chocolate, right?
Day 1: Learn the basics
Financial literacy is knowing how to make good decisions when it comes to managing your money. Understanding the language of money is the first step.
Here’s a few terms which are essential to help kickstart your journey:
Credit: Any money, goods or service which is borrowed and needs to be repaid.
Interest: The cost of borrowing money, or the earnings you can receive from your savings, expressed as a percentage.
Inflation: The rise in prices over time for anything from fuel to the socks you were planning on getting your dad again…
Assets: Any financially valuable resources one can own, like property, cash or investments.
Get the full low down in our A-Z blog here.
Day 2: Take stock of your finances
Look into your income, expenses, and any debt you might have. Knowing exactly where you stand financially is the best way to figure out what you need to do to get to where you want to go. Get it all down in one place, whether that’s in a spreadsheet or a notebook, visualising what you’re working with can be a great help.
Day 3: Track your spending
Remembering how much you’re spending day-to-day isn’t always the easiest (especially at this time of year). But keeping track of things by writing it down can help. By watching out for your wallet, you might think twice about having one more festive work drink or buying yourself a gift you might not necessarily need.
Check out this blog to find out more.
Day 4: Set financial goals
You know where you’re at financially, now you want to figure out where you’re going. Think of your big goals in life — is it buying your own home, retiring at 60, or getting a dog? Write it down somewhere. What about in a year's time, where do you want to be financially? Debt-free? With an emergency fund saved up? Write that down too! Maybe your goals are smaller and are simply being able to put aside a bit of money into savings next month. That’s okay! You guessed it, write it down.
You might like to try the SMART method for your goals which you can learn about in this blog.
Day 5: Think in percentages, not pounds
When it comes to saving, usually it’s better to choose a percentage of your income that works for you rather than a set amount of pounds. That way, if your pay goes up or down, your savings will stay relative and reasonable to those changes.
Day 6: Start a budget
With us now: “Oh, the spending outside is frightful, but my budget is so delightful.”
Now that you’ve got your goals and you’ve got a handle on your incomings and outgoings, it’s time to put a plan in place to make your goals happen. Check out one of our favourite budgeting techniques: the 70-20-10 rule.
Day 7: Make finance tips part of your day-to-day
If we all listened to finance podcasts as much as we listened to Christmas carols at this time of year, we’d probably be laughing when it came to managing our money. Okay, you don’t have to binge-listen to finance convos but try peppering content like that into your day-to-day through social media, podcasts or books. It’s a simple way of normalising the money conversation and improving your financial literacy along the way.
Follow @Loqbox to get a regular dose of money tips and more.
Day 8: Learn about credit and interest rates
Understanding how interest rates can make a difference to credit like loans and mortgages — and in turn, to your personal finances if you have any debt — is key for strong money management. This blog unwraps it all for you.
Day 9: Understand your credit score
It wouldn’t be a Loqbox advent calendar if we didn’t give you the gift of credit score knowledge. A credit score gives you the lowdown on how financially trustworthy you might be considered to lenders. The numerical value is created according to your credit report and gives an indication of how creditworthy you potentially are. There’s a whole host of information on credit scores on our blog but this one is a good place to start.
Day 10: Try a no-spend challenge
Emphasis on the “challenge” part of this advent day. We know that keeping spending to a minimum at this time of the year is not easy but the aim of this game is to be mindful. It doesn’t need to be a complete ban on everything, you set the rules here. You could pick a day over the weekend where you only do free festive activities or next week try and only bring food and coffee from home when heading to the office.
Day 11: Ask for advice if you need it
You won’t be put on the naughty list for not knowing everything about finance, especially not if you’re willing to learn. If you’re not sure about something, ask for advice from someone you know and trust or reach out to one of these free financial advice services:
- MoneyHelper is a government-backed service that provides free and impartial financial guidance.
- Citizens Advice is a network of independent charities in the UK that offer free and independent advice on a wide range of topics, including money.
- StepChange is the UK’s largest debt charity. They offer free and impartial debt advice — both online and via the phone.
- The National Debtline is a free and confidential debt advice charity run by the Money Advice Trust.
- Turn2Us is a national charity that offers practical support with money.
Day 12: Practise mindful spending habits
Let’s face it, the pressure to spend at this time of year is real. Today we want to encourage you to take a moment to reflect before you buy something. Ask yourself “is this a necessary purchase?” and “will it make your life or someone else's better?”. If the answer to those questions is “no” then consider whether you definitely need to get it.
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