Are you finances a mess? Do you have several credit cards, loans, and financing plans? Do you live paycheck to paycheck, watching your bank balance get perilously close to zero every week or month? Do you live in your overdraft, trapped and unable to break free? Have you stopped checking your bank balance because you just can’t face it or do you have a pile of unopened bills?
If you’ve answered yes to these questions, you are by no means alone. If you’ve answered no, but with a little guilt, as you no that you’ve been late on some payments lately, or because you know that your debts will be increasing over the holiday period, you are perhaps in the majority. Most of us have debts. Many of us will use credit cards to pay for Christmas presents, and a fair few of us are utterly clueless when it comes to our own finances.
You might have told yourself that you’ll sort it out in the New Year. Or that your resolution for 2019 will be to save some money or pay off your debts. But, why wait? Fair enough, this isn’t the best time to think about saving. But, it might be the best time to confront your finances, especially if you are considering becoming a sole trader or starting your own business.
Check Your Balances
The first step to taking control of your finances has got to be confronting them. Check your bank balance, but don’t just look at the figure at the bottom. Look at what you are spending every month, and ask yourself if there is anything that you could easily do without. Get rid of it.
If you’ve got debts, whether they are on credit or store cards, loans or in overdrafts, it’s important to know exactly what you owe, but also how much these debts are costing you. Work out how much you are paying in fees and interest each month. I bet having that much more money would make a big difference to your finances.
Make a Debt Repayment Plan
Paying debts off, unfortunately, is rarely as simple as deciding to do it and making the payment. If it were that easy, we wouldn’t have debt. So, create a plan. Work out how much you can afford to pay off your debts each month or week if that is easier for you, and set up a direct debit for that amount. It’s also a good idea to explore options like balance transfer cards and low-interest consolidation loans to see if they could save you money and make your repayments easier to manage.
Start Making Your Money Work
If you’ve got a little money set aside, even a small amount towards a holiday or next Christmas, make it work. Look into Etrade for easy ways to invest, or move it into a high-interest account. Let your money make money.
Prepare a Household Budget
A household budget is a fantastic way to manage your finances, but only if you are realistic, and you take the time to use it.