The New Year is upon us, so aim to make your personal finances one of your New Year’s resolutions. You may be already financially secure, but it can improve. On the other hand, if you’re already struggling with your finances then there are plenty you can do this year.
Being financially secure is a goal most of us would like to achieve. Having debts that we need to pay back, bills that are due, and savings that are non existent can make our future seem a little unstable and this can lead to unwanted extra stress. I will cover a few things you can do in this coming year that will help you to become more financially secure.
PAY BACK YOUR DEBTS
The main cause of financial stress is usually due to debts. When you owe money, all of a sudden there seems to be an overwhelming situation. Each month you need to find funds to continually reduce this debt but when you have high interest rates or interest rates that are going up, it ends up feeling like you are making no progress. This is why this must become a focus. There a variety of options available to you that can speed up the process. You can try and consolidate your existing debts into one large loan at a smaller interest rate. At the very least, this will make managing the debt easier. You could try and re-finance existing debts in order to reduce the interest rate – an example of this might be to apply for a Personal Loan to reduce credit card debt. This also has the benefit of having a definite finishing date, so you know when you are likely to be debt free. Another option is to pay more off each month to reduce the time it takes to pay back the debt. Remember…..any extra money you find must be directed at the debt. Every little bit helps contribute to you meeting your goals faster.
START SAVING
When you have your emergency plan in place, it is amazing how much less stressful your situation can seem. Knowing that you have the money put aside in case of an emergency. Basically, you need to change your mindset. Saving money is about delaying gratification today in order to buy later. Start today – work out what you have spent on this Christmas’s gifts and other expenses. Divide this into equal payments over the next 12 mths and by next Christmas – you will have a fully funded Christmas account ready and waiting. Goodbye Credit Card.
Once you have your savings plan in place and you are debt free except for the family home, you can decide to start investing your money. You would be amazed at how little you need to be able to invest your money and earn extra interest – this will speed up your savings plan and create a roll on effect.
Plan ahead and stick to it. Re-visit your budget continually. Once you have your budget in place, you can easily work out how much you need to put towards debts, savings and investing. This might even help inspire you towards a new business idea or part time job.
Once you are in control of your finances, you will never dread that first credit card bill of the New Year ever again – why? Because there will not be a credit card bill to pay, as you would have just drained your Christmas Club account ready for a new one to start immediately. Congratulations……..you are well on your way to Financial Freedom.
Credit Advisor
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