8 good money habits to adopt in 2023 to help your money go further

A new year is the perfect time to ditch those bad money habits and exchange them for some good ones. Here's how

young girl putting coins into a piggy bank to illustrate good money saving habits
(Image credit: Getty Images)

2023 is just around the corner, and at a time when household budgets are being squeezed from every direction, there’s never been a better time to consider how you can improve your finances.

Against a backdrop of high energy bills, rising food prices and record high inflation, households are continually looking for tips on how to save money (opens in new tab). Despite the Energy Price Guarantee (opens in new tab) coming into effect in October, millions of families remain concerned about how much their energy bills will cost (opens in new tab) and are looking to make cutbacks.

Goodto.com’s Money Editor, Sarah Handley (opens in new tab), says: “A new year is always the perfect opportunity to start over and give your finances some TLC. But this year it’s particularly important as families continue to feel the pinch due to the rising cost of living.”

With that in mind, we’ve come up with eight good money habits to adopt in 2023 to help your money go further.

 1. Get better at budgeting 

Budgeting is an important and relatively easy way of getting your finances back on track, and it will ensure you know which expenses need prioritising each month. (Find out more about what budgeting is (opens in new tab) and why it’s important.)

Marketing director at EQ Investors, Ben Faulkner (opens in new tab), says: “Controlling your spending during ‘normal’ times is important, during times of uncertainty, it’s imperative. Create a household budget by listing both your income and outgoings to help you manage your money better. The Money Advice Service (opens in new tab) has a useful free budget planner to help you get started.”

Go through your bank statements and weed out any unwanted magazine subscriptions, insurance policies or gym memberships. You want to get to a point where the amount you have going out does not exceed the money you have coming in. It’s worth doing this every one to two months to make sure you stay on top of it.

2. Spend less money 

Even the smallest of purchases can quickly eat into your bank balance. So for 2023, make it your mission to cut back on your spending.

A good place to start is to resist impulse purchases. It can be particularly difficult to do this if the price has been discounted or stock is running low and you feel you might miss out. But take a step back, sleep on it, and see if you still think you need it when you wake up the next morning. 

Co-founder and COO of pocket money app GoHenry, Louise Hill (opens in new tab), says: “At some point, we’ve all experienced the consequences of giving in to impulse buys or spending our money too quickly, and it’s a tough lesson when learned the hard way! 

“But spending less doesn’t mean that you and your family can’t have fun. Try and introduce fakeaways on the weekend or have your very own ‘Come Dine with Me’ experience with your friends. There are plenty of ways to spend time together without the need to spend money - like taking walks around your local area, exploring places you might not have been to before or even a simple arts and crafts day with the kids in the house on a rainy day.”

3. Focus on your debt 

As interest rates rise, debt becomes more expensive. So if you’ve got credit card balances, loans or overdrafts to clear, it’s time to give them some attention and consider how to pay off debts fast (opens in new tab).

Lucy Sherliker (opens in new tab) from car finance marketplace Zuto, told us: “Although paying back loans and credit will prevent you from saving as much money as you might like, the quicker you can get these loans paid off, the more money you’ll be able to save in the future. Start by paying off your high-interest loans first, as these cost you the most in the long-term, and pay off your credit cards so they can be used in an emergency.”

If you can, shift any expensive credit card debt to a 0% balance transfer credit card to benefit from interest-free payments for several months (read our guide to how credit cards work (opens in new tab) to find out more about the types of credit card available). You’ll tackle your debt faster and save hundreds of pounds in interest. Just watch out for the transfer fee of around 3%.

4. Build up an emergency savings pot if you can

To ensure you don’t build up more debt in the event of a financial emergency such as a boiler or car breakdown, it’s important to have an emergency savings pot to fall back on. 

“Many of us make the mistake of saving what’s left at the end of the month, which often means very little or nothing at all,” says Ben Faulkner from EQ Investors. “Instead, make saving some of what you earn a monthly priority. Start with a small sum at the beginning of the month. Then, when you don’t notice that money not being there, increase it slightly until you get into the habit of saving a decent amount each month. A good rule of thumb is to aim for the equivalent of 3-6 months outgoings in cash.”

Setting up a monthly standing order to transfer a set (affordable) amount is an easy way to ensure you do this. You could also kickstart a savings habit with the 1p savings challenge (opens in new tab), and it's worth finding out whether you qualify for the Help to Save (opens in new tab) scheme where you can get a boost to your savings if you get into a good long-term savings habit. 

5. Be a savvy shopper 

There are stacks of ways you can save money when shopping. Seeking out the cheapest supermarket (opens in new tab) for your weekly food shop is one option, but you can also use a supermarket loyalty card (opens in new tab), and make the most of discounts and vouchers or by using sites such as our sister brand MyVoucherCodes. (opens in new tab) 

You can also claw some of your money back by using cashback websites (opens in new tab) such as TopCashback and Quidco. These let you earn a sum of money whenever you go to a retailer’s online store by using an affiliate link from a cashback website.

You’ll save even more by checking you’re getting the best price for your chosen item by using price tracking sites like idealo.co.uk (opens in new tab), Kelkoo (opens in new tab) or Camel Camel Camel (opens in new tab) before you buy.

Senior band and communications manager at Idealo, Katy Phillips (opens in new tab), says: “In a time where saving money is essential for many households, the ability to price compare across multiple retailers is very handy and is a great habit to adopt to ensure you’re getting the best deal. Always remember to do your research and don’t get tempted by the first deal you see, make sure it suits you and what you’re looking for.” 

7. Don’t let contracts auto-renew 

It’s so easy to let your car or home insurance automatically renew, but don’t. It might seem like a hassle, but it’s easy to use price comparison sites like our sister site Go.Compare (opens in new tab) to check whether you can find a cheaper deal. 

You’ll only need to do it once a year for each policy, but it could save you a significant chunk of money. 

Brean Horne, (opens in new tab) personal finance expert at Nerdwallet says: “Once you have a cheaper quote from another provider, it is worth asking your current insurer if they can match or beat the new quote. Another way of saving money is to pay annually for insurance contracts, as opposed to monthly, as it will often be cheaper.” 

 8. Write a will 

Finally, if you have children or other dependants and haven’t yet written a will, make 2023 the year you do.

Hoxton Capital Management’s head of wills & trusts, Jessica Thambiappah (opens in new tab), says: “It’s very easy to put off making a will until it is too late, which can lead to many problems. It is important to make a will so that all of your inheritance goes to who you want. It enables you to plan exactly what will happen to your estate.”

If your will is simple, you can use a will template online or buy one in stationery shops. Alternatively, you can use a will-writing service or a solicitor - using a solicitor will be more expensive, but it is the best option if your will is more complex.

Rachel Wait

Rachel is a freelance personal finance journalist who has been writing about everything from mortgages to car insurance for over a decade. Having previously worked at Shares Magazine, where she specialised in small-cap stocks, Rachel developed a passion for consumer finance and saving money when she moved to lovemoney.com (opens in new tab). She later spent more than 8 years as an editor at price comparison site MoneySuperMarket where she helped support the CRM programme, as well as the SEO and PR teams, often acting as spokesperson. Rachel went freelance in 2020, just as the pandemic hit, and has since written for numerous websites and national newspapers, including The Mail on Sunday, The Observer, The Sun and Forbes. She is passionate about helping consumers become more confident with their finances, giving them the tools they need to take control of their money and make savings. In her spare time, Rachel is a keen traveller and baker.