07 January 2016

Your guide to stress-free financial planning

There’s no denying that dealing with your finances can be stressful.

In fact, research from MoneySupermarket shows that 31% of consumers – 15.6 million people – worry about money on a daily basis.

Worryingly, three-fifths of adults who are worried about money believe their problems are impacting on other areas of their life, affecting their health, wellbeing and even relationships.

We’ve taken a look at some of the financial situations people find most stressful, and how you can deal with them effectively.

Getting on the property ladder

Taking your first step on the property ladder has never been tougher, with research by Rightmove suggesting first-time buyers have to save an extra £16,000 compared to just one year ago, with the average first-time buyer paying nearly £185,000 for a property.

There is help available for first-time buyers. The new cash Help to Buy: ISA is the latest of a series of “Help to Buy” schemes from the Government to help people get onto the housing ladder.

Looking to get on the housing ladder

See how Nationwide’s Help to Buy: ISA could help you save for a deposit.

Find out more detail about the Help to Buy Government scheme.

Our mortgage calculator can help you work out how much you may be able to realistically borrow and whether you’d be able to afford monthly mortgage repayments.

Paying off debt

Worrying about how to pay off your debts can be extremely stressful and it can be tempting to ignore them. But the best thing to do is approach the situation head on. Make a list of everything you owe, including credit card balances, loans and overdrafts. Then work out how much you have to pay each month to meet minimum repayments. Once you’ve done this you can look at your monthly budget and figure out how much extra you can afford to pay towards your debts each month to get back into the black, or if there are any cutbacks you can make which will help you pay down your debts sooner.

It’s also worth thinking about ways you can make managing your debt easier. For example, shifting what you owe onto an interest-free balance transfer credit card means that while you still owe the same sum, your repayments are going further. Similarly, consolidating your loans means you have just one monthly repayment to organise and you may be able to get a cheaper rate.

Taking steps to control your finances

If you’re having payment difficulties it’s essential to talk to your creditors about your debts as soon as possible. Many lenders, including Nationwide, subscribe to The Lending Code, which means they’re committed to dealing sympathetically with people having payment difficulties and may be able to offer ways to help. Find out more about The Lending Code.

Check out our ‘How to reduce debt’ video

Building up a nest egg

Not having any or enough savings for a rainy day can be a huge cause of worry and again it’s easy to try and put it to the back of your mind, but even saving a little bit each month can make a real difference.

Firstly, have you got anywhere to put your savings? Keeping them in a separate savings account can make them much less tempting to dip into. Once you have a separate account, work out how much you want to save each month and set up a direct debit to your savings account for payday each month, so you can’t be tempted to spend it.

If you’re struggling to find cash to save, it’s a good idea to take a look at how you spend your money. Write down everything you spend in a week, however small, including takeaway coffees, bus fares etc, and see if there’s anything you can live without. You can redirect this cash to your savings each week.

There are also a number of apps available which are designed to make it easier to save. Our mobile app has an Impulse Saver feature, which allows you to transfer small amounts from your current account to your savings account in just a few taps.

Switching current account

If you’ve been with your bank for years, the thought of switching can be stressful, even if you know your account doesn’t meet your needs anymore. However, thanks to the Current Account Switch Service you can now switch accounts and move all your incoming and outgoing payments hassle free.

Under the guarantee, all switches will take just 7 working days and the Current Account Switch Service takes care of moving over your salary, direct debits and regular payments for you. You can also rest assured that any payments accidentally sent to your old account will be automatically redirected for 36 months.

Find out more about switching with Nationwide

Quick tips for preventing financial stress

1 – Don’t ignore the situation
Ignoring money worries will just make them worse, so the best thing to do is tackle them head on. Even paying a small sum off your credit card or putting a few pounds into savings each month can make a difference over time, and is definitely better than doing nothing.

2 – Ask for help
If you’re not a financial whizz, ask someone else for help and advice. A friend or relative you trust can help you see options you may have overlooked. It’s also worth getting a professional’s opinion, such as at your bank or building society.

3 – Set clear targets
If your financial situation isn’t exactly how you want it to be, rather than sitting and worrying, set yourself some clear targets to help you improve it. Start with small, achievable things like saving a small sum each month or regularly paying money off your credit card. Remember to be realistic, if you’re never going to be debt-free in a year, don’t promise yourself you will be, as it’ll just make you more stressed.

Feeling stressed because of your finances?

Here are a few free sources of help and advice if you’re having trouble with debts:

Current Account Switch Guarantee

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When you switch you're covered by the Current Account Switch Guarantee.

This guarantees that your old account will be closed and all your payment arrangements will be switched to us in 7 working days.

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