Even HMRC may make financial mistakes sometimes

How to minimize financial mistakes for your household

08:41 04 June 2013

Financial mistakes can happen to anyone, including the HMRC - as a Manchester Cafe owner found out after receiving an incorrect bill for Value Added Tax (VAT) of nearly £1billion. Luckily, the HMRC quickly corrected the matter.

 

However, not all financial mistakes are so easily corrected. We’re much more liable to make the sort of financial mistakes that cause us to receive a penalty from the bank or late fee. Here are a few ways we can avoid certain financial mistakes of our own:

 

• Reconciling accounts-it’s challenging enough sometimes keeping track of accounts when you are the only one spending, but it’s much easier to encounter financial mistakes when more than one person shares the account. Making sure you know all the purchases and reconciling accounts monthly can help minimize issues. 

 

• Book-keeping-you don’t necessarily have to save everything, but it’s good practise to save documents which may come in handy later such as banking statements, credit card bills, and other things that usually show your billing details and any payments you might make. Checking these frequently can alert you to financial mistakes by the company, or errors in your own calculating when reconciling accounts. 

 

• Software-certain software can play a big part in minimizing financial mistakes as long as the information entered is accurate. Some software can automatically synchronize with your banking accounts, and there are also a variety of apps to help you keep finances organized. 

 

• Play it safe-when in doubt about whether or not you’ll be able to spend a certain amount, always err on the side of caution. Staying well within limits means you won’t suffer overdraft penalties, late fees, or other repercussions from financial mistakes.

 

• Check accounts before shopping-verify credit card balances and available funds, as well as banking account information before you go shopping to minimize overspending. If you happened to forget a recurring payment or other transaction, double checking amounts before you go lend added security.