If one of your new year’s resolutions is to be more money-wise, and to be more flush than frugal come December, then the time to take small yet significant steps is now.
“Even if your resolutions are already long forgotten or you haven’t yet managed to stick to a budget or even draw one up, you can make positive strides any time of the year,” says Susan Steward, Marketing Manager of Budget Insurance.
“No matter where you are financially, it’s possible to improve your position. Whether your first step in the right direction was taken on 1 January, or whether it hasn’t yet been taken, it’s possible to have a more financially friendly year, starting now.”
If you’re not sure where to start, a budget is always a smart first step. This will help you feel more in control, knowing where your money is going each month and ensuring you live within your means.
Creating a budget can be done in a few simple steps. Here’s how:
• Write down your net income, that is the money you get after tax or any other deductions.
• Track your spending. Start by listing all your fixed expenses such as rent/ bond, car payments and insurance. Then list your variable expenses, which are the expenses that could change from month to month such as groceries, your phone bill and clothing.
• Tip: always keep track of what you’re spending and if you’re unsure, look at recent bank or credit card statements.
• Look at your income versus your spending, and set your goals. It could be a short-term goal like paying off your credit card, or a longer-term goal like saving for a house deposit, or setting up a retirement fund.
• By referring to your goals and how much you need to budget for fixed and variable expenses, you can see where you have money left over, and how it can be used to reach your financial objectives. You can also see where you can potentially cut back or make changes.
There are many small tweaks you can make to your spending habits that will help you save money. Here are some examples:
• Shop online, and take advantage of specials on items that you need.
• Not hitting the gym that much? Cancel the subscription and go for walks instead.
• Schedule no-spend weekends.
• Take your own lunch to work.
• Write a list before you go shopping, and stick to it.
• Invite friends over instead of going out.
• Be more cautious of electricity and water usage at home.
• Keep your tyres properly inflated – you’ll prolong their life as well as save on petrol.
• Pay your bills on time. You might incur interest on late payment, plus it could affect your credit rating.
• Check your cellphone package and ensure you’re on the right one for your pocket and your needs (do you really need the 200 free SMSes, for example?).
• Chat to your insurance company and ask them if they can adjust your car insurance premium based on the current value of your vehicle.
“Creating a budget will also help ensure that you can always pay your important expenses first and avoid late payments on your credit card or on your insurance premiums, for example,” concluded Steward.
Do you perhaps have more information pertaining to this story? Email us at randfonteinherald@caxton.co.za (remember to include your contact details) or phone us on 011 693 3671.
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