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Personal finance is an area that most of us would like to become better with. But with so many competing pressures on our cash and the cost of living spiralling, it can sometimes seem impossible to have everything. However, if you become a whizz at budgeting it is perfectly possible to have your cake and eat it too – enough to live comfortably, be able to save, avoid unhealthy amounts of debt, have the occasional splurge and still move towards your financial goals.
Use Your Credit Right
Many of us have the wrong attitude towards credit cards – either carelessly racking up debt without realising what we will be repaying and for how long, or avoiding them altogether. Neither approach is healthy – credit is a useful tool when used sensibly, and if you don’t use it you may find you have a low credit rating when it comes to important things like applying for a mortgage, as lenders can’t see any borrowing history. Use credit as a tool to empower you, by making sure that you don’t use it for things like clothes and evenings out, but do have credit available to cover travel, major repairs and other events like that – or to be able to buy something at a great price when it’s on offer but you don’t immediately have the cash available. Find a credit card with a 0% introductory rate, and adjust your budget so that you can make the full repayment within the time. This way you’ll build up a good credit score, be able to take advantage of a deal on something you need, and you won’t be racking up interest.
Start Investing Today
We tend to think of financial investments as something only the rich do, but the truth is that anyone can start investing – and it’s a great way to move towards a long-term financial goal, such as saving for a house deposit, your children’s college education or even a retirement fund. There are so many investment apps out there which allow you to get started for a very small deposit, and will let you choose a risk profile and then invest on your behalf. With regular deposits you can soon find you’re building up a nice little nest egg. Some apps will even combine a regular automatic deposit with round-ups connected to your debit card – where they round up each transaction to the nearest whole amount and put the difference into your savings. Due to the nature of investments, they aren’t suitable for quick access cash so make sure you have rainy day savings elsewhere.
Save On Your Shopping
All this saving means you can’t treat yourself to nice clothes, trips with your kids and eating out, right? Well actually, that doesn’t have to be the case if you shop smart and learn how to make a personal budget. Try a few simple tricks. Firstly, when you see that must-have new top, add it to a wishlist which you can keep in the notes app on your phone, rather than immediately purchasing it. The cooling off period gives you time to see if you really want the item and if it fits in your life, and can prevent a lot of decisions you regret later.Second, learn to shop strategically. Sign up for sale notifications on your favourite retailer’s websites or set up an alert on ebay for clothes from a particular shop or designer – you can set it to ‘new with tags’ in the preferences if you like. Also learn to move your clothes on – if you no longer wear something, sell it on and put the cash in a ‘fun’ account you use for clothes and entertainment. When it comes to eating out, check money saving coupon sites for a voucher before making that reservation.