Is now the perfect time to rethink your spending?

id

You might be feeling a bit of financial pressure just now, perhaps due to festive gift-buying and higher-than-normal energy bills in the colder weather. But January can feel like a fresh start. So this could be a good time to inspect your spending and see if there are ways to improve your finances. Here are our top tips.

1. Clean up direct debits and recurring payments

People often use direct debits or recurring payments for things like bills, memberships, or subscriptions. Having a direct debit means you’ve given a company permission to take payments from your bank account on a regular basis. Recurring payments let companies take payments from your debit or credit card.

These things can easily slip your mind, as the money’s taken automatically. Maybe you’re still paying for a gym membership, apps or TV streaming services you no longer use.

You can usually check your direct debits and recurring payments through your online banking, or contact your bank if you’re not sure. You could save money by cancelling ones you don’t use. But it’s important to check with the company to see if you can cancel, as you might still be in a contract with them.

2. Set a financial goal

January can be a great time to set a financial goal for 2026 or even beyond.

Think about the type of things you’d like to work towards – like a holiday, or a new car.

Then consider how you’ll try to reach that goal. There are different things you can do with your money – save, invest, or a mix of both. It’s a good idea to read MoneyHelper’s guide on the difference between saving and investing to help you decide which way to go.

And no matter how far away it is for you, it’s important to think about retirement. People are generally living longer these days, and your retirement savings might need to last several decades.

So if you’ve got a pension plan, why not check how much you’ve currently got in it? Normally, you can do this online or on your provider’s app. You can find out more about our online services on our website, or see our support page for FAQs and ways to get in touch.

Then you could use our pension calculator to get an idea of how much you might have in future and whether you’re on track for the lifestyle you want.

Don’t panic if not – you could consider paying more into your pension plan, if that’s right for you. Remember, a pension plan is an investment. Its value can go down as well as up and could be worth less than was paid in.

3. Consider an emergency fund

An emergency fund is money you’ve set aside for when things don’t go to plan – for example, if your boiler breaks or you’re hit with a big vet bill. You might keep this money in an instant-access savings account or similar so you can take it when you need it.

According to MoneyHelper, it could be good to have between three-six months’ worth of essential outgoings in your emergency fund. 

But even saving a little bit could give you some peace of mind this year and further down the line.

4. Build your budget

A budget can make it easier to manage your money.

You could start by thinking about what your monthly income is.

Then look at how much you’re typically spending on your wants and needs in a month. You could check things like bank statements, receipts and bills. It’s worth considering whether you could get better deals on things like your mobile phone or internet, as this could reduce your spending.

Looking at your income and outgoings can help you see how much you might have left over to put towards an emergency fund, your financial goals, or anything else you might want.

MoneyHelper’s budget planner could be a useful tool for you.

If you have a partner, you might want to create or update your budget together, based on what you’ve both got coming in and going out.

5. Get support – and keep up to date with changes

Remember, you can free money and pensions guidance from MoneyHelper. You could also think about getting financial advice from a financial adviser – find out more information about advice.

If you’re worried about debt, don’t forget you can get support from places like Citizens Advice or StepChange.

Finally, it’s worth keeping up to date with what changes are coming in as a result of the Chancellor’s Autumn Budget, so you can manage your money accordingly. Take a look at our article for more.

 

The information here is based on our understanding in January 2026 and shouldn't be taken as financial advice.