Financial admin has a habit of sitting at the bottom of the to-do list.
There is always something more urgent than checking your pension beneficiaries or comparing insurance policies. If the bills are being paid and nothing appears to be wrong, it’s tempting to leave everything alone.
But a once-a-year financial review can uncover forgotten subscriptions, outdated policies, poor savings rates and paperwork that hasn’t kept up with changes in your life.
You don’t need an elaborate system. Pick a date each year, make yourself a cup of tea and work through these seven jobs.
1. Review Your Household Bills
Start with the money leaving your account every month.
Go through your direct debits and standing orders and make sure you recognise everything you’re paying for. It’s surprisingly easy for old subscriptions, memberships and services to continue long after you’ve stopped using them.
Look at:
- Energy
- Broadband
- Mobile phones
- Streaming services
- Gym memberships
- Software and apps
- Children’s subscriptions and activities
- Other recurring payments
Ask whether you still need each service and whether you’re getting reasonable value.
Don’t automatically switch purely because you’ve found a cheaper headline price. Check contract lengths, exit fees and exactly what’s included.
The goal is to stop paying more than necessary for things you already buy — and stop paying altogether for things you no longer use.
2. Check Your Savings Accounts
Opening a competitive savings account doesn’t mean it will remain competitive forever.
Interest rates change, introductory bonuses expire and new accounts appear. Meanwhile, money that’s been sitting quietly in the same account for years may be earning considerably less than it could elsewhere.
Once a year, check the interest rates on your savings.
Consider what each pot is for too.
Emergency savings should generally be accessible when you need them. Money earmarked for a future expense may have a different timeframe and therefore different savings options.
If you’ve accumulated several small accounts over the years, this can also be a good opportunity to organise them.
You don’t necessarily need to move anything. Just make sure you know:
- Where your savings are held
- How much you have
- What interest you’re receiving
- How quickly you can access the money
- What each pot is intended for
A savings account should have a job, not simply exist because you opened it five years ago.
3. Review Your Insurance
Insurance is easy to renew without much thought, particularly when renewal is automatic.
Take the opportunity to check whether your policies still reflect your circumstances.
That could include home, car, life, travel and other insurance relevant to your household.
Check the level of cover, excesses, exclusions and renewal price rather than looking only at the monthly premium.
Your needs may have changed during the year.
Perhaps you’ve moved house, changed jobs, bought something valuable, had another child or significantly altered how much you drive.
Life insurance deserves particular attention after major family or financial changes. A policy arranged years ago may no longer reflect your mortgage, income or number of dependants.
The cheapest insurance isn’t necessarily the best insurance.
You want appropriate cover at a competitive price.
4. Check Your Pension
Your pension doesn’t require daily attention, but ignoring it for decades isn’t a particularly good strategy either.
At least once a year, log in and see what’s happening.
Check:
- Your current pension balance
- How much you’re contributing
- Your employer’s contribution
- Where the money is invested
- The fees you’re paying
- Your nominated beneficiaries
- Any retirement projections provided
If your salary has increased, consider whether you could increase your contribution.
It’s also worth checking whether your employer offers additional matching if you contribute above the minimum.
If you’ve changed jobs several times, make sure you haven’t lost track of old workplace pensions. Keep a record of the providers and account details somewhere secure.
Retirement may be decades away, but an annual check takes very little time compared with the number of years your pension may eventually need to support you.
5. Look at Your Debts
Make a list of everything you owe outside your mortgage, if you have one.
That might include credit cards, personal loans, overdrafts or other borrowing.
For each debt, note the balance, interest rate and monthly repayment.
Pay particular attention to promotional rates. A 0% credit-card period can be useful, but you need to know when it ends and what rate will apply afterwards.
An annual review can also show you how much progress you’ve made.
A balance that has fallen from £6,000 to £3,500 might not feel particularly exciting from month to month, but stepping back and looking at the year reveals that you’ve cleared £2,500.
Use that information to decide what comes next.
Perhaps you want to increase repayments, refinance expensive borrowing or set a target for clearing a particular balance.
6. Update Your Important Documents
Some financial jobs aren’t about saving money. They’re about making life considerably easier if something goes wrong.
Check whether your important documents and instructions are current.
Depending on your circumstances, this could include:
- Your will
- Pension beneficiaries
- Life insurance beneficiaries
- Emergency contact information
- Property documents
- Insurance details
- Details of important financial accounts
If you’ve married, separated, had a child, bought a property or experienced another major life change, older arrangements may no longer reflect what you want.
Make sure your partner or another appropriate person knows how to locate essential information if necessary.
That doesn’t mean sharing passwords insecurely. It means ensuring your household isn’t dependent on one person knowing where every financial account and policy exists.
7. Calculate Your Financial Progress
Finish your annual review by looking at the bigger picture.
You don’t need an elaborate financial dashboard.
Simply record a few useful numbers, such as:
- Cash savings
- Investment balances
- Pension balances
- Outstanding debts
- Mortgage balance
- Major financial goals
You could also calculate your approximate net worth by adding up what you own and subtracting what you owe.
Don’t become discouraged if the figure hasn’t moved dramatically. Some years are expensive. You may have taken parental leave, moved house, dealt with an emergency or prioritised something other than building wealth.
The purpose is to create a snapshot.
When you repeat the exercise next year, you’ll have something meaningful to compare against.
Put Your Annual Money Date in the Calendar
Financial admin becomes much easier when it has a regular place in your year.
Choose a date that works for you. January might feel like a natural fresh start, while others may prefer the beginning of the tax year or a quieter month when family life is less hectic.
Keep notes on what you’ve checked and anything that requires further action.
You don’t need to optimise every account, policy and bill in a single afternoon.
The objective is simply to make sure nothing important has been forgotten.
One organised financial review each year can catch problems before they become expensive, highlight progress you might otherwise overlook and give you a much clearer picture of where your money stands.
Then you can close the spreadsheets, put the paperwork away and get on with the rest of your life — until next year’s money date.