Life is what happens when you are busy making other plans. But by developing a few good financial habits, you can be prepared for anything that comes your way.

1. If you are saving for something special...
Whether you are going on a dream holiday, buying a new car or planning a wedding, saving is better than borrowing and means that large purchases are achievable and painless. What could be better than having a cash lump sum just when you need it? Calculate how much you need to put aside each month and save a little extra on top in case prices rise. Think about how long you can afford to tie your cash up for and whether you may need instant access.

2. If you are planning a family...
Make sure there is plenty of flexibility in your finances. The last thing you will want during pregnancy or when your baby arrives is money worries. If you are planning to take time off work beyond the period of your paid maternity leave then review your budget to take account of the reduced salary. If you own your home, your mortgage will be your biggest monthly bill and therefore, is a prime target for cost reduction. A discounted interest rate will reduce your monthly payments. Alternatively, a fixed or capped rate will provide peace of mind that your payments will not increase for a set period. Many lenders now offer payment holidays for expectant parents, although some require a number of over-payments in advance.

3. If you have a family....
Planning for the future is a must if you want to ensure your little ones do not break the bank. The average child will cost his or her parents more than £140,000 from birth to the age of 21, according to research from Liverpool Victoria. The most expensive period is during university. All in all, you will need to become pretty good at saving (see point one, above). If you earn between £45,000 and £50,000 a year as a couple or as a single parent, then make sure you take your child tax credit annual entitlement of £545. Those with at least one child under the age of one will receive a bigger credit, worth up to £1,090.

4. If you drive...
Don't leave it to the last minute to shop around for a better car insurance deal. Put the renewal date in your diary and then a reminder at least a month beforehand to allow time to find a better deal. Most large insurers have websites that provide instant quotes in a few minutes, making it possible to compare at least half-a-dozen firms from the comfort of your own home. If you are over 25 and have a clean licence, you may be able to cut your premium by half. You can always take the cheapest quote back to your current insurer to see if they can match it.

5. If you pay off your credit card bill every month...
Make sure your credit card includes cashback. For every pound you spend, the credit card issuer will give you some money back, usually after 12 months. Every time you buy something you qualify for a small percentage of the price credited back to your account. Remember though, if you pay your bill late or carry some credit even for one month then you may find that the value of the cashback is far outweighed by the cost of interest.

6. If you own your home...
Keep your home contents insurance up to date. A wardrobe of clothes is a prime source of 'hidden' home contents assets because the value can creep up slowly. The average spend on new clothes by the UK's top earners is about £25 a week, according to government figures. Clothes shopping at this rate will add about £1,300 to the value of a wardrobe every year, giving an appreciation of nearly £4,000 over just three years.

7. If you want a healthy credit rating...
Apply for a copy of your file held by Britain's two credit reference agencies, Equifax and Experian. They pass information to and from credit issuers. If you have been refused credit you may find out why when you get a copy of your file. More importantly, you can correct any errors. Contact Equifax on 08705 783783 or www.equifax.co.uk and Experian on 0115 976 8747 or www.experian.co.uk.

8. If you want to save on bills...
Opt for direct debit payments. In addition to the convenience and peace of mind that the bill has been paid by a certain date, you can often get discounts. Many utilities providers will offer up to 15% off your bill if you sign up to pay by direct debit. Plus, there is the reassurance of knowing that every direct debit is protected by three main safeguards: an immediate money-back guarantee from the bank or building society if an error is made, advance notice from the organisation if the date or the amount of the direct debit changes and ultimately, the right to cancel.

9. If you pay tax...
Make the most of your tax breaks. One option is an Individual Savings Account (ISA). The two main types of ISA - 'maxi' and 'mini' - allow you to invest or save a certain amount without having to share the proceeds with the tax man; there is no capital gains or income tax to be paid on returns.

10. If you go abroad more than once a year...
Take out an annual insurance policy. They represent much better value than buying cover as you go along. Typically, you might have to pay around £100 for the entire family, but the cost varies for worldwide or European cover and the amount of days' cover you need per year.