4 simple tips to get your budget under control!
If your budget is running rampant and out of control, you may find yourself going backwards. Keeping up with multiple repayment, covering ever increasing living expenses, school fees, car maintenance – it all ad’s up very quickly. If this sounds all too familiar then perhaps it’s time you stopped for a moment to really take a look at your budget and see where you can make improvements to maximize your cashflow.
- Re-asses your budget
Many of us don’t pay a great deal of attention to our spending habits, we just go to work, earn an income, and buy what we need or want. Print out your bank statements and credit card statements for the last 6 months – you’ll be shocked and amazed at exactly where all your hard earned income is going, and you will see many areas instantly where you can cut back and save on things you don’t really need in the short term. Spa treatments, gym memberships you don’t use, pay tv subscriptions that you haven’t watched in months, gaming memberships that you just don’t use anymore – the list can go on. Each on their own doesn’t amount to much, but once you add them all up it makes a huge difference.
- Understand your ongoing commitments
Banks and lenders alike typically look at your current financial position. If it appears to be unorganized with a range of debts, this can lead to issues when you apply for a loan. It is important to understand that they look at your position as a whole, including what access to credit you already have. For example, a credit card with a $20,000 limit and a $0 balance, in the banks eyes in a $20,000 debt. If you don’t need multiple unused credit cards why keep them? Try reducing your liabilities to the minimum you need, for example a single credit card with a balance you can easily afford to pay off within one-two months.
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- Saving for a deposit, holiday or other big purchase?
Set yourself a budget and follow it. This is certainly easier said than done, but sometimes you have to ask your self – do I need a new 70 inch TV? the latest smartphone? or even just ordering take away tonight? Sometimes of course the answer will be yes – but more often than not you will find that bigger goal you are savings towards is far more important – besides, there will be a new TV, or smartphone tomorrow. These devices are made and marketed to real you in on the latest features, when your current device is actually doing everything you need already!
- Consolidating could be a great idea
If you’re struggling meeting your monthly commitments, or just over seeing all your disposable income going on to multiple loan repayments then maybe a consolidation can be a great way to lower your burden and put some cash back in your pocket every month to enjoy life.
Merging your accounts in to one simple, easy to manage repayment can work wonders for your quality of life. You could even use the equity in your home to rоll these іn tо уоur home loan.
In many cases the overall terms, rates and fees could be lowered, but sometimes it’s just the fact that you have simplified your finances that can make the decision an easy one. Some things to consider is does the new loan alleviate any cash flow issues you may have? If the answer is yes then this could be a great option to consider.
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