It’s a brand new year and with this dawning, often comes a realisation that it is now a great time as ever to get back into forming some kind of method around one’s expenditure.
Unfortunately, this feeling more often than not lasts only until the next shopping spree. It happens. “Such is life,” you tell yourself. Until you run into financial trouble and struggle to pay your bills (yet again).
If you’re as sick and tired of being broke as we are, here is a small checklist of three easy yet effective steps to get your finances back on track over the next 12 months!
- Get rid of high-interest debt first (and fast!)
It comes as no surprise to many that one’s credit card debt is one of the most unnecessary liabilities that one will ever have – what with exorbitant interest rates often exceeding north of a whopping 20%.
Hence, it is of common sense (there are exceptions to this cause but they rarely appear) that one should pay off this kind of debt before any form of investing is considered. This is of course unless a situation appears where one is offered rare returns on investment that exceed that amount. In other words, a guaranteed return, NOT just a possible one.
For those who do not know where to start on reducing the (at times) insurmountable figure, Credit Counselling Singapore offers a Repayment Assistant Scheme that will help you work that debt down.
- Get your accounts sorted to obtain the best rates
Singapore offers a plethora of bank accounts (not to mention credit cards) with competitive interest rates to woo your money over – across financial institutions.
There are accounts for everyone, from student savers to high yielding one’s, for those with higher amounts of liquid cash via fixed deposits as well depositing one’s salary directly into certain accounts. Shop around and you won’t regret it. It’s all about compound interest and getting the best deals available.
Apart from that, credit card rewards should never be ignored. From sign-up bonuses to giveaways and petrol as well as dining discounts, different merchant services (and banks) are in a constant struggle to sign you up for that latest piece of plastic (or metal in some cases). Always remember the first point on the dangers of debt, use these cards as a tool (and not be reliant on them) to get the best of what they have to offer.
- Set a budget and stick to it
Whether it has to come in the form of an app, manual creation of an excel sheet or even through mindful attention to one’s expenditure, setting a budget in the New Year is one thing that will make your financial year all the more rewarding.
Apart from facilitating you to understand and ascertain your true financial position, budgets also help one to set goals and stick to them. It is never too early to start, and teaching your kids to create one for themselves will also pay in the long run to their overall attitude towards money as well as financial discipline.
As a start, we’ve previously broken down the all-useful 50-30-20 rule within an article here, it’s a simple and great way to begin your budgeting journey. While you’re at it, make sure to steer clear of these lame excuses for not saving money!
The above points only serve as fundamentals that will start the beginning of your financial journey. Rome wasn’t built in a day and your financial future will also grow slowly but steadily to form the all-important and sought after tag of financial freedom.
Happy New Year, here’s to a prosperous 2017!