When it comes to managing finances, without forward planning of your financial situation and where your money is being spent, it can be easy to end up living week to week.
This can impact on your ability to plan for holidays, buying a house, school fees, power bills or unexpected costs.
So where do you start…
Make a spreadsheet so you can keep updated with your salary, your partners salary, income from pension, shares or self employed work income.
Spreadsheets can be found online or through ASIC’s Money Smart offer a free budget planner.
This will give you a starting point so you know exactly how much you have to work with each month.
Make a list of your regular outgoing expenses including monthly payments such as credit cards, mortgage repayments, car loans, insurances and utility bills.
Average your monthly grocery costs
Make a list of incidental expenses such as: entertainment, hobbies, eating out, shopping etc. Use a monthly average figure as these costs may vary.
Total all of your expenses and compare it with your earnings. This will give you a clear picture of your spending habits.
Look at what you’re spending your money on. Are you spending too much on coffee, gym membership, eating out? Could you reduce these expenses by making coffee at work or taking lunch to work instead of buying?
You may find that you have money left over. Could you put this into a high-interest savings account or reduce any credit card balances?
ASK FOR A BETTER DEAL
Ask for a better deal with your power supplier, phone or credit card company. Simply asking could result in more savings for you!
Re-look at your Insurance Policies. Are you paying for what you need? Is there a cheaper alternative out there that provides the same or similar insurance cover?
When did you last look at your home loan interest rate? Have you considered comparing your bank with other lenders? Refinancing to a lower interest rate could help reduce your monthly mortgage repayment and save you paying unnecessary interest back to the bank. Before refinancing, take a look at your current home loan conditions. Are there any break fee costs?
Could you consolidate high interest rate credit cards into a low interest personal loan? This will not only move credit card repayments into one manageable loan, but could save you paying unnecessary interest.
Tip: Close off the credit card account once they have been paid out.
Keeping a financial budget is an ongoing task that will vary from month to month, but by following it and staying on track you will be able manage finances and set financial goals whether planning for that holiday, new home, car or just simply not feel guilty about having a night out.
For more information on reducing home loan costs, refinancing car loans, credit card consolidation, contact our office on 1300 350 118 for an obligation free quote.