Now that 2018 is in full swing, it’s time to think about your financial goals for the New Year! Whether you’re in crippling debt from Christmas shopping sprees, are saving for a house or just want to get your credit score into shape, these tips are just what you need to get started on the right track.
Take Stock of Your Financial Situation
Take some time to review any loans you have, credit card debts and fees, the fees and level of interest that are applicable on your bank accounts, and how you’re handling your weekly/monthly income and expenses. Once you have an overall view of where you’re spending money and where you can save money, you’ll be better equipped to manage your funds well in 2018.
Decide on Your Goals for the Next 12-Months
Before you start making plans for how you’ll handle your money over the course of the next year, take some time to think about your goals. Maybe you want to buy a house, start a small business, or even go on a big overseas trip. Once you’ve identified what you’d like to accomplish, you’ll be able to put a plan in place to help you reach your goals.
Get your Mortgage into Shape
If you don’t have a mortgage but you want to purchase your first property in 2018, now’s the time to discuss your options with a financial advisor while also checking to make sure the rest of your finances are in good shape.
However, if you already have a mortgage there are a few steps you can take to save money in the long-term. It’s worth discussing your current home loan with a financial provider, reviewing your interest rate and repayments and seeing if you would be better off taking your loan to a new lender. This could be particularly beneficial if your property’s value has changed drastically in recent years or if your lender has higher interest rates than their competitors.
Increasing your monthly repayments and changing your payment schedule can also help you save money in the long-term. By simply paying off as little as $100 a month extra, you’ll shave time and how much money you’re paying in interest on your home loan. A lot of people don’t realise this, but by making your repayments weekly or fortnightly, rather than monthly, you’ll also reduce the overall amount of interest you’re paying.
Review Your Credit Situation
Did you use your credit cards a lot over Christmas? Have you racked up a lot of credit card debt and are struggling to keep up with your repayments while also handling your everyday living expenses? Or maybe you just want to review your current credit rating because you’re hoping to apply for a home loan in 2018. Regardless of your situation, responsible credit management is a must for anyone with a credit card.
If you have a lot of credit card debt to pay off, this should be your priority. You should also make it your goal in 2018 to start using your credit cards less, so you can become less reliant on them, increase your credit rating and prevent yourself from ending up in a dire financial position in the future.
To ensure your credit rating is kept in good shape, make sure you keep up with bill payments, loan repayments, and carefully manage your credit cards, by minimising usage, and always making your payments in a timely fashion.
Focus on Building Up Your Saving’s Account
Your saving’s capabilities will depend on how much you earn and your expenses, however, as a general rule, you should be aiming to put 10-20 per cent of your weekly or monthly income into savings. For instance, if you earn $3500 per month, you should be saving at least $350 a month, or $700 if you go by the 20 per cent rule.
By building up your saving’s account, you’ll not only be increasing your financial portfolio, you’ll also be providing yourself with a security blanket for if any unexpected costs come up, as well as setting yourself up for a stronger, wealthier 2018 – plus, the more you put in, the more interest you’ll gain!
Just remember, if you do need to dip into your savings, try not to let it become a habit and always aim to replace it as soon as you can. If you have a low income or relatively high expenses, trying to live by this rule can be tricky and even stressful at times, however, even just simple habits like getting a cup of coffee each day builds up and by giving up these habits you’ll be setting yourself up for a more prosperous financial future.
If you want to make sure 2018 is the year you get your finances on track but need a little help finding out exactly what you should be doing, talk to Complete Financial Services today! We can assist you with everything from home and small business loans to finance options if you’re self-employed.