Last month, Kay Wightman from Accounting for Good ran an ADHD and Money workshop to help people with ADHD with their relationship with finances.
This can be a challenging relationship to have at times, but hopefully, the advice outlined in this blog will help you to manage your finances more effectively.
Expenses and Goals
A productive way to manage your expenses is to create a monthly or weekly budget. This way, you have more control and knowledge of how much can be spent over a certain period.
Perhaps one of the easiest ways of thinking about your expenses is as fixed and variable costs. Your fixed expenses include things such as housing rent/your mortgage, utilities, loans, and transportation. These are costs that can be more easily planned for as they will be mostly unchanged on a month-by-month basis.
Your variable expenses can be slightly more difficult to manage. These include things such as food, petrol, clothing, and entertainment.
One of the most accessible ways to manage these expenses is to have certain spending pots for each category within your variable expenses to spend each month. These can then be reviewed and altered at the end of each month as you figure out which pots need altering to match your spending habits.
To keep your variable costs down, it is also important to review any direct debits you may have set up for services you do not use any more – for example subscription services that take out a fee each month.
Saving and Spending
It is important to have short-, medium-, and long-term savings goals to work towards.
Short-term goals can include keeping financial papers organised and saving a certain amount of money per week.
Medium-term goals can be saving for a holiday or paying off a credit card.
Long-term goals involve things like saving for a deposit on a house or planning for retirement.
To save for these goals there are multiple steps you can take, including:
• Making a budget, as detailed above
• Having a day of the week or month to review your spending and alter your spending habits
and/or your budget
• Paying electronically to keep track of your finances through your banking, or through
financial wellbeing apps such as Emma
• Opening a savings account.
Make sure you regularly review how much you are saving and spending to keep your financial plans relevant to your income.
A concern for people with ADHD can be impulse spending. There are steps you can take to limit the urge to do so, such as adding up purchases as you shop, unsubscribing from marketing emails, and shopping with a specific list to avoid any unnecessary purchases.
For larger purchases, it can be helpful to wait 24 hours before purchasing the item to make sure it is a necessary item for you to buy
Credit cards can make it significantly easier for impulse spending to occur – so it would be recommended that instead you pay with a debit card or cash to make sure you do not end up in debt from these types of purchases.
If these ideas do not work for you, there are more extreme steps you can take, such as having a trusted friend or family member to hold your card for you, putting a sticky-note on your card to remind you of what you are saving for, or cancelling all but one card so you can keep a better track of your spending.
Money Management Schedule
One final way to manage your money is to make a daily, weekly, monthly, and yearly checklist of things to do to keep your finances organised. Here is an example plan to use:
• Collect receipts
• Enter receipts onto personal finance software
• Open bills from the post and write on when they need to be paid
• Pay bills writing PAID and the date and keep in your paid bills folder – remove from your
paid bills folder the previous bill for the same company
• Look on your online banking for direct debits and add them to your online finance software
• Look to see if you have any expenses to pay next week
• Visit the bank to deposit any cash – some banks allow you to deposit cheques with their app
• Review weekly spending
• Make sure your bank statement and your finance system balance
• For personal expenditure you can now shred the documents
• Look at your budget and patterns of spending to see if there is too much in any category
• Collect all financial papers together if you need to file a self-assessment
• Plan your next years’ budget
Of course, this is an example and can be tweaked to better suit your needs.
Hopefully, this was useful for you in helping you manage your own finances. If you have any questions, feel free to get in touch with us for advice and support.