Managing your finances can be a painstaking process and accumulating wealth isn’t something that happens overnight (unless of course you’re lucky enough to hit the jackpot). Achieving financial fitness takes a lot of discipline and planning and getting into the habit of regularly saving money is a good way to start.
Just like your house, your finances could probably do with a little spring cleaning too – so here are our eight powerful tips you can use to do just that.
1. Spring clean your house (literally)
Yes, this article is about spring cleaning your finances and the best way to start is by spring cleaning your house first. You never know what little treasures may be hiding in plain sight or lurking at the back of a cupboard somewhere. Check every room, every closet and every storage space to find any items that you don’t really use, but that you can sell to earn some extra money – and as a bonus, your house will get cleaner, too. Just make sure you save the proceeds from your sales rather than blowing it on something you don’t really need.
2. Clean up your subscriptions
This tip applies to both spring cleaning your finances and saving money. It’s super easy to subscribe to monthly or annual services that you don’t really use, so check your credit card statement for any that you can live without. Whether it’s $100 on Foxtel or $10 on Netflix, it’s not really the amount that matters - it’s whether you’re getting value out of it or not. If you don’t really need it, it’s time to cancel it.
3. List down your expenses
The same approach applies to all your expenses. Make a list of everything you’re regularly paying, then eliminate any unnecessary expenses, and check what you can do to reduce the costs of those you need. For example, electricity is definitely something you need to keep. But by shopping around for the best deal or reducing your power usage, you are essentially lowering your expenses, too.
4. Clear your debts
As you’d expect, spring cleaning your finances definitely includes clearing your debts. While it may take a while to clear all of them, the best time to begin is now. Credit cards and other types of loans have high interest rates, which can cause you to get even deeper into debt. Make a plan to pay them off, and one option to do this is to consolidate them. Start controlling your debts before they control you.
5. Review your personal health insurance
If you have private health insurance, check that it’s still the most suitable solution for you. Insurance evolves over time. That's why it's worth reviewing it this spring to check that you are on the most appropriate plan, and that you’re getting the most out of it. If you pay for extras cover every month but only really use it for an annual dental check-up, maybe it’s time to switch to hospital only cover. Don’t forget to check the various health insurance providers to make sure you’re getting the best available deal.
6. Review your home loan
As with your health insurance, home loan conditions also change through the years. What could have been suitable for you five or ten years ago may not be the best option for you today. Check what the best rates are then give your bank a call and ask them to match it. If they come to the party, great – if not, it may be time to move to a new lender.
7. Set your budget
As with most things, you can’t monitor it if you can’t measure it - so it’s a good idea to set yourself an expenses budget. It’s an excellent money management skill that can help you prevent spending more money than you want to. It doesn’t have to be complicated, you can use a simple spreadsheet to develop your expense budget and then use it to monitor your weekly or monthly spend.
8. Set your financial goals
Now that you’ve got your expenses under control, it’s time to set your financial goals. Develop your short, medium and long term financial goals and check regularly to make sure you’re on track. The key is to set goals that are achievable but take a little discipline. What they are is up to you – you might want a goal that is a specific amount saved each month, or a percentage of your salary that you want to save. Your goal may be to start paying additional money into your superannuation account or to invest a set amount in blue chip shares each month.
It’s time to spring clean your finances now!
Spring is here, and it’s the best time to clean up your finances and set goals. Financial freedom doesn’t happen in the blink of an eye - you need to work on it. And, if you do need some financial assistance or if you want to consolidate your debts, we’re here to help. Just take a look at our cash loans from $1K - $5K to find out how quick and easy it is to get your hands on some extra funds. Once a loan is approved, the cash is usually in your bank account within a few hours.