Tips for Looking After Your Personal Finances

Getting your personal finances in order is really important, especially if you are looking to take out a mortgage or get a bank loan. There are a few different signs that your personal finances may not be in great shape and that you should do something about them which are discussed here.

It’s not uncommon for people to be in debt, in fact, a little bit of debt can help with your credit score. It shows lenders that you are able to take on debt and pay it back. The problems arise when you are unable to pay debts back whether it’s due to losing your job or simply not being able to keep up with the interest on the payments.

These three quick tips will help to evaluate different areas of your financial situation and may help you to identify where improvements or changes need to be made to ensure that you are financially secure for the future.

Credit Cards

There are a very large number of people in the US that have at least one credit card. If you are trying to get a mortgage then it can be good to pay them off every month where possible. It may be that you just put your weekly food shopping on the credit card and pay it off at end of the month when you get paid.

According to an Arkansas Bankruptcy Attorney, if you are only making minimum payments on a credit card every month, this could be a sign that your personal finances are not where they should be. It’s at this point you should understand what your debt commitments are and how you can pay them off to reduce the interest you are paying.

Savings

It estimated that the average person in the US saves just over $100 per month from their monthly pay packet. This only adds up to around $1200 per year which, if you have a mortgage or other commitments isn’t a lot to cover bills if anything went wrong.

It can be good to try and set aside a certain amount at the start of the month that you would like to save, say $500. By doing this at the beginning of the month you are limiting your spending so that you are not saving what’s leftover, you are spending what’s left after saving. This can be particularly useful if you are saving for a vacation, a house deposit or a new car.

Household Bills

Checking what different providers might charge for household bills like water, electric, gas, and broadband will likely save you hundreds of dollars every year. It is very easy to go onto price comparison websites and types in what your typical usage is. Don’t rely on energy providers to tell you when a better deal is available, although they should do this now by law.

Other bills that you might be able to cut down on are lifestyle bills. Gym memberships can be anything from $20 to $100+ a month. If you are not going regularly, then it may be worth putting that money into savings. Subscriptions are another that can easily slip by without you noticing, especially when they are under $10 a month.

This article does not necessarily reflect the opinions of the editors or management of EconoTimes.