Think Money says 'think of the future'

Think Money, a financial solutions company, has warned people to think about the future, especially if they're already struggling financially today.

The warning follows a report by Lloyds TSB which says many people's finances aren't in great shape. According to the report, as many as one in five individuals (19%) spend their entire income on essentials like their mortgage and utilities - with no money left over for discretionary items.

Moreover, around a quarter of people believe they'll be in a worse financial situation - with less discretionary income - in six months' time than they are now.

Think Money says that when millions of people in the UK need to make every penny count, managing your money well is especially important in case things did get tougher further down the line. Income rises were outstripped by rises in the cost of living throughout 2011. If you can't make your money stretch far enough now, how would you cope with less income?

A budget can identify areas of overspending and help you to gain a better understanding of where your money goes. However, cutting back isn't always enough. If you're in debt, it's possible you could lower your monthly payments to an affordable level with a debt management plan, although you would need to speak to a debt adviser to see if it's right for you. They may be able to advise on other methods to reduce your outgoings too, if that's appropriate.